Innovative Finance Facility for Climate in Asia and the Pacific

The Innovative Finance Facility for Climate in Asia and the Pacific (IF-CAP) is a strategic initiative to mobilize climate finance at scale and accelerate climate action in Asia and the Pacific. It features a pioneering guarantee mechanism, which will enhance ADB’s lending capacity through financial leverage and enable ADB to make more resources available for investments in climate mitigation and adaptation across the region. Projections show that a $1 contribution for guarantees from financing partners could facilitate $4 to $5 of new ADB climate loans. IF-CAP will also provide traditional grants to support project preparation, capacity building, and knowledge sharing. IF-CAP is a financing partnership facility that will comprise multi-donor trust funds, single-donor trust funds, bilateral guarantees and risk participations, and other partnerships.

The ADB Board of Directors approved the IF-CAP Financing Partnership Facility in April 2023. This was launched at the 2023 Annual Meeting in Incheon, with the governments of Denmark, Japan, the Republic of Korea, Sweden, the United Kingdom, and the United States expressing support. Negotiations are ongoing to finalize the participation of IF-CAP’s financing partners.

Following the announcement of a $35 million contribution by the philanthropy Global Energy Alliance for People and Planet (GEAPP) to ADB to support shared energy and climate change priorities, the GEAPP Energy Access and Transition Trust Fund was established under the IF-CAP Financing Partnership Facility in June 2023.