Asian Infrastructure Investment Bank to Fully Align with Goals of Paris Agreement by 2023
30th October 2021 | Hong Kong
Asian Infrastructure Investment Bank (AIIB), a multilateral development bank backed by China, will align operations with the goals of Paris Agreement by 1st of July 2021. The Paris Agreement sets out a global framework to avoid dangerous climate change by limiting global warming to well below 2°C and pursuing efforts to limit it to 1.5°C. Asian Infrastructure Investment Bank (AIIB) currently estimates its cumulative climate finance approvals to be $50 billion by 2030, a 4-fold increase in annual climate finance commitments since AIIB started publicly reporting the number in 2019.
” AIIB to Fully Align with Goals of Paris Agreement by 2023 “
AIIB President and Chair of the Board of Directors, Jin Liqun:
“We are at a defining moment in history—one which calls for bold, fast and wide-ranging collective action if we are to limit global warming and protect our fragile planet. Today’s announcement reinforces AIIB’s long-standing pledge to support climate action in line with the Paris Agreement.
We think the way forward needs greater participation by the private sector on all fronts, so that we can collectively deliver on the promise of building an inclusive, equitable and sustainable future.”
The Paris Alignment Commitment, AIIB
The Paris Alignment commitment would apply to sovereign and non-sovereign projects, including investments made via financial intermediaries. AIIB is currently testing a rigorous process to ensure projects meet low-carbon and climate-resilient standards consistent with the Paris accord. The approach draws on the international standards and frameworks currently being developed in collaboration with other multilateral development banks.
In the lead-up to COP26 in November, more than 130 countries have set or are considering a net-zero carbon emissions target by 2050. However, the current level of ambition set out in these plans is, in aggregate, still far too low for the international community to meet the temperature goal of the Paris Agreement to limit global warming to well below 2 degrees Celsius, preferably to 1.5 degrees, compared to pre-industrial levels. AIIB sees leveraging emerging technologies as key to raising climate ambition.
In 2020, AIIB launched the AIIB-Amundi Climate Change Investment Framework, the objective of which is to hasten the transition to a low-carbon economy through the capital markets. The framework allows investors to analyze climate risks with investment opportunities by translating the three objectives of the Paris Agreement (mitigation, resilience to physical change and transition to green economy) into quantifiable investment metrics by aligning financial flows with a low-carbon, climate-resilient pathway.
Related:
- London Stock Exchange Launches Sustainable Finance Innovation Unit in Singapore to Support Green Projects, Climate Risks & ESG
- Singapore Exchange Proposes Mandatory Climate Disclosures in Issuers Sustainability Reports from 2022, New Diversity Policy at Board Level
- Hong Kong SFC to Require Fund Managers to Include Climate into Investment & Risk Management Process, Starts from August 2022
- IPCC Report: Impact of 1.5°C Increase on Global Warming & Climate Change
About AIIB
The Asian Infrastructure Investment Bank (AIIB) is a multilateral development bank whose mission is financing the Infrastructure for Tomorrow—infrastructure with sustainability at its core. We began operations in Beijing in January 2016 and have since grown to 104 approved members worldwide. We are capitalized at USD100 billion and Triple-A-rated by the major international credit rating agencies. Working with partners, AIIB meets clients’ needs by unlocking new capital and investing in infrastructure that is green, technology-enabled and promotes regional connectivity.
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