Developing countries labelled as “frontier markets” represented almost half of the total lent by the Asian Development Bank (ADB) to the private sector in 2015, according to the institution.
More than 40 percent of the financing provided over the course of the year was invested in lower-middle-income and low-income countries (excluding India), the ADB said. Projects supported included power and telecommunications assets in Myanmar and a liquid natural gas facility in Pakistan.
The ADB offered a record $2.6 billion of new financing to the private sector in 2015, a 37 percent increase from a year earlier and 62 percent higher than in 2013. The bank aims to double the size of its invested portfolio from its current $8 billion by 2020.
In 2015, more than 30 percent of private sector transactions were focused on climate change and renewable energy. These have included the first green bond in the region for a geothermal operator in the Philippines, a credit-enhanced project bond for the refinancing of a wind power company in India and the financing of new wind power generation in Thailand.
Seven out of 9 private sector energy investments made last year are considered green projects.
In addition to the provision of its own capital, ADB worked on catalysing the flow of third-party commercial financing into its transaction through co-financings and risk mitigation products.
ADB’s private sector co-financing reached more than $4.5 billion last year, including nearly $1.5 billion of B-loan syndications and risk transfers across diverse markets like Azerbaijan, China, India and Myanmar.
The bank also aimed to create more commercially viable public-private partnerships (PPP) through providing its service as transaction advisor for projects like the North South Railway and Commuter Rail Line, which at $3.8 billion is billed as the largest-ever PPP in the Philippines.