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Economy 26/09/2024 Mobilizing private capital through innovative capital market instruments

Mobilizing private capital through innovative capital market instruments

Tashkent, Uzbekistan (UzDaily.com) — As part of the ninth annual meeting of the Asian Infrastructure Investment Bank (ABII), a panel discussion titled "Mobilizing Private Capital through Innovative Capital Market Instruments" took place, focusing on key strategies for attracting private investments into green and climate infrastructure development.

Speakers included Najib Haider, General Director of the ABII Project and Corporate Finance Department; Antoine Castel, Chief Risk Officer at ABII; Maé Adèle, Capital Market Operations Advisor at the Ministry of Finance of Egypt; and Kate Lau, Head of the Portfolio Management, Infrastructure Financing, and Securitization (IFS).

During the session, participants emphasized that innovative capital market instruments, such as asset securitization and project bonds, can significantly accelerate capital inflow into infrastructure projects in developing countries. These instruments enable the redistribution of long-term assets from traditional bank lenders to institutional investors, thereby stimulating sustainable development.

“Using capital market instruments to finance the infrastructure gap introduces new complexities and risks due to the involvement of multiple stakeholders,” noted Antoine Castel, Chief Risk Officer at ABII. “Therefore, a reliable regulatory framework is essential to ensure the stability and efficiency of the system, protecting the interests of all stakeholders.”

The crucial role of guarantees in attracting private capital for green and climate projects was also highlighted. Guarantees reduce risks and make projects more appealing to private investors, which is particularly relevant for emerging markets. This approach aligns with ABII’s priorities for mobilizing private capital and developing sustainable infrastructure.

“When we talk about capital markets, I believe ABII focuses primarily on our strategy for mobilizing private capital. As the only multilateral development bank of the 21st century, we strive to be client-oriented and responsive to demands. We also aim to be innovative because we believe that to meet the needs of our clients in today’s world, we must be both innovative and responsive,” emphasized Najib Haider, General Director of ABII’s Project and Corporate Client Department.

The panel discussion showcased how ABII successfully employs these financial instruments to mobilize capital for both sovereign and non-sovereign partners. Participants noted that these strategies help overcome the financing deficit for infrastructure projects, which in turn supports long-term sustainable economic growth.

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