THE Asian Development Bank (ADB) on Tuesday (May 2) announced a new programme that could significantly ramp up investment support in the Asia-Pacific for the fight against climate change.

Called the Innovative Finance Facility for Climate in Asia and the Pacific (If-Cap), the programme’s initial partners include Denmark, Japan, South Korea, Sweden, the UK, and the US.

They are in discussions with ADB to provide grants for project preparation, along with guarantees for parts of the bank’s sovereign loan portfolios.

The reduced risk exposure created by the guarantees will allow the bank to free up capital to accelerate new loans for climate projects, said ADB.

The bank added that for every $1 that is guaranteed, up to $5 of new climate loans could be generated.

“With a model of ‘$1 in, $5 out’, the initial ambition of US$3 billion in guarantees could create up to US$15 billion in new loans for much-needed climate projects across Asia and the Pacific,” it said.

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If-Cap financing will contribute to the bank’s ambition to allocate US$100 billion from its own resources towards climate change purposes for the period from 2019 to 2030, said ADB.

The bank also said that it is in discussions with other potential partners, including countries and philanthropies, to accelerate climate investments.

“Climate change is the critical issue of our lifetime, and here in Asia and the Pacific we are on the frontlines of that battle,” said ADB president Masatsugu Asakawa during the announcement, which was made on the opening day of the bank’s 56th Annual Meeting in Incheon, South Korea.

“The climate events we have experienced over the past 12 months will only increase in intensity and frequency, so we must take bold action now.”