Aligning Climate Finance and Development Finance for Asia and the Pacific: Potential and Prospects

Abstract

"Development projects may contribute to mitigation and/or adaptation. Mitigation and adaptation projects likewise may have development benefits. But development and climate change projects are not the same. All projects should, to the extent possible, contribute both to development and to climate change mitigation and/or adaptation. Alignment requires that development projects access climate funding and that climate projects access development funding. Alignment implies two different roles for the Asian Development Bank (ADB): seeking climate finance for its development projects and serving as an implementing entity for climate projects in countries in Asia and the Pacific. The first role is best implemented using climate change funds from bilateral donors or from ADB’s own resources. ADB would need to continue to mobilize climate change funds for this purpose. The shifting institutional structure for climate finance creates challenges for ADB as an implementing entity. However, there will be relatively few competitors in many of the countries in the Asia and Pacific region where ADB operates. "