Singapore, August 8 (ANI): Last week, Infrastructure Asia, a platform created by Enterprise Singapore and Singapore’s Central Bank, the Monetary Authority of Singapore, launched an online portal for infrastructure projects that links the government, developers, and financiers (MAS).
Indranee Rajah, Singapore’s second minister for finance, made the official announcement of the portal on August 2 at the Asian Infrastructure Forum. She stated that it aims to support greater regional collaboration among complementary experts and raise awareness of the project opportunities in the exciting growth sector of sustainable infrastructure.
In addition to surfacing the pipeline of infrastructure projects in the region, the new online project portal acts as a marketplace for various parties interested in developing infrastructure projects in Asia.
There are 11 infrastructure projects listed on the portal that have a value greater than USD2.7 billion, according to a look at the projects that are currently listed there. Seven projects are concerned with water and sanitation, two with logistics, and two with rail transportation. With five projects listed, Indonesia has the most, followed by two projects each from Cambodia and the Philippines, five from Vietnam, and one from India.
The second stage of the New Delhi Railway Redevelopment Project is the Indian project that is listed on the portal.
According to Infrastructure Asia, Singapore is in a unique position to meet Asia’s infrastructure needs and unleash the region’s infrastructure potential because of its established ecosystem of numerous private sector companies, including developers, engineering firms, procurement companies, construction firms, professional service providers, financial institutions, and multilateral development banks.
According to Lavan Thiru, executive director of Infrastructure Asia, finding partners and solution providers comes at a very high cost.
So there was a need for a platform that was impartial, independent to some extent, and most importantly, a platform that could perform some curation, he continued. The recently launched project portal aims to highlight local infrastructure initiatives and can link parties from the public and private sectors who are interested in collaborating to develop these initiatives.
The platform allows project owners to post the project specifications, and interested parties—such as solution providers or financiers—can access information about the project—including its value, owner, and developers.
According to Thiru, Infrastructure Asia will choose projects to list on the portal based on whether they are barely bankable and are in industries where Singapore or companies with a Singaporean presence are knowledgeable.
Minister Indranee stated during her opening keynote address at the Asia Infrastructure Forum, which was held at the Marina Bay Sands Expo and Convention Centre, that immediate and significant emissions reductions are required to meet the Paris Agreement’s goal of keeping global warming to 1.5 degrees Celsius.
She continued by saying that Singapore, which declared it would increase its climate ambition to reach net-zero emissions by or around the middle of the century, would make sure that its climate pledges were supported by the appropriate strategies, policies, and actions.
The Minister kept going, “Infrastructure planning, construction, and management must undergo a radical transformation if we are to achieve our Sustainable Development Goals. Brownfield infrastructure, or existing assets, which account for almost 80 percent of all greenhouse gas emissions, particularly in the energy, transportation, and building sectors, is one opportunity that is frequently overlooked. We have a lot of options for decarbonizing our current infrastructure, including enhancing resource and energy efficiency in the built environment.”
Brownfield asset investments may only require small initial investments, but they could result in enormous decarbonization gains.
The International Finance Corporation (IFC) predicts that making buildings more energy efficient could cut greenhouse gas emissions by nearly a billion tonnes in Asia’s emerging markets. This equates to about 15% of all vehicles on the road around the world, or nearly 200 million internal combustion engine vehicles.
To ensure that these solutions can scale, capital is needed. By 2030, it is predicted that Southeast Asia will require $2 trillion in investment to build sustainable infrastructure. Governments are aware of the enormous amount of funding required, and while they are stepping up to take the lead, private funding is still necessary.
To finance sustainable infrastructure projects by 2030, Singapore’s public sector will issue up to SGD35 billion (USD25.3 billion) in green bonds. The governments of the Philippines and India have also announced that they will issue their own green bonds.
Infrastructure projects need private financial institution funding in addition to public funding to be successful. Business Times Singapore (BT) spoke to banks who said that in order to receive financing, a project must not only support social and environmental causes but also be profitable. Long-term loans must be repaid by the cash flows from sustainable infrastructure.
According to Yulanda Chung, head of sustainability for the institutional banking group at DBS, commercial contract structures and regulatory certainty are required to manage these issues. Strong tariff models that balance project costs and societal affordability, as well as suitable economic incentives, are needed to further close the gap.
“We think having a framework will help banks finance more sustainable infrastructure projects,” Chung said. “It will outline a robust governance process on how the money raised will be used, and clearly define the green standards.”
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Construction, Infrastructure and Mining
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