Catalyzing Private Investment for Development

Thank you for having me, Dean.

And maybe let me start with the way that you set the context, even before the financial instrument.

So if you look at the investment needs, there was a report that we prepared, albeit a few years back, but it put the total investment needs for developing Asia at $1.7 trillion a year, every year till 2030.

Now, this clearly is not something that can be met by public finances.

We need private capital to come in to invest in all of these developmental requirements.

In our understanding, Asia does not necessarily lack that capital, but much of that capital is not reaching the countries, sectors, currencies, or maturities where the development needs are the greatest.

So for me, two constraints stand out.

One is the enabling environment.

So if you look at investor confidence, which is directly related to investment environment, and this is an area which still needs a lot of work in most of these developing countries.

Enabling policy environment and regulatory certainty are integral to attracting private capital.

It's not separate from it.

And the importance of upstream work of creating markets, building the right institutions, ensuring appropriate regulatory reforms, these cannot be overstated.

And what we've seen as ADB, where our sovereign and non-sovereign operations are on the same balance sheet, The greatest successes are there where we have been able to influence both policy in the upstream policy as also use these kind of regulatory reforms that our sovereign colleagues do and then devise downstream financing structures for these highly developmental transactions.

The second aspect that I want to focus on is bankable project pipelines.

And this is where, Dean, the question that you asked in terms of role of blended finance comes in.

So if you look at various instruments, guarantees that address political offtake or creditor risk, local currency financing that addresses foreign exchange mismatches, viability gap funding or concessional financing, which may be justified where a project has high developmental value but cannot be earn the full commercial return.

And this is what we are trying to do as ADB.

We use every tool in our toolbox.

Guarantees, concessional financing, risk participations, balance sheet optimization tools.

Just last year in 2025, we delivered $9.5 billion in financing for private sector, of which just $3.1 billion was on our own resources.

And the remaining was capital that ADB helped mobilize.

So that's the approach that we are taking.

This is the only way we believe that we can meet the objective of financing that Asia needs.