The climate investment and SDG financing gap in Asia are enormous. Based on ADB estimates, $1.7 trillion a year is needed for climate-adjusted infrastructure investments in developing Asian economies.

MDBs have risen to the challenge. ADB, in particular, is committed to ensuring that at least 75% of its operations (on a 3-year rolling average) will support climate change mitigation and/or adaptation by 2030 and climate finance from ADB’s resources to reach its ambition of $100 billion cumulatively by 2030.

However, a multi-pronged approach is necessary to achieve the needed mobilization of public and private financial capital at scale. A key plank is the greening of financial systems and what financial regulators and supervisors should and can do to take the necessary measures to foster a greener financial system.

A well-functioning and vibrant financial system that is resilient to climate-related risks and able and willing to play its part in scaling up climate finance is a pre-condition to achieving low-carbon and climate-resilient development in developing countries in this region, in line with the Paris Agreement.

ADB organized a hybrid event on Green Financial Systems and the Role of Multilateral Development Banks. Four themes are key in this regard and were covered in the ADB conference. 

The hybrid conference aimed to:

• Provide an understanding of Green Investment Banks, their benefits, and challenges, and identify the key success and sustainability factors of green banks from green bank cases
• Present international experience in assessing, monitoring, and addressing climate-related risks in the finance sector
• Discuss the way forward for financial supervisors and regulators in Asia and how they can support green financial markets.
• Discuss the role of multilateral development banks in transitioning to more resilient and greener financial systems and catalyzing private sector finance and establishing GIBs.