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The first Sustainable Finance in the Indo-Pacific (SUFIP)
AFD and the India Exim Bank (EXIM) have co-organized in Paris on February 21st, 2022, on the eve of the EU ministerial Forum for cooperation in the Indo-Pacific, an important gathering of public development banks (PDBs) and Financing institutions of Europe and the Indo-Pacific, to address the sustainable development challenges of the region. As the first gathering of its kind, addressing specifically sustainable and climate finance in the Indo-Pacific, this event has successfully mobilized more than 500 participants from 27 countries, which is a praise-worthy achievement. The Director General for International Partnerships of the European Commission has notably underlined the value of the discussions for the implementation of the European Union cooperation strategy in the Indo-Pacific.

Faced with the urgency of the global and climate-related challenges affecting the Indo-Pacific countries, participants reaffirmed their commitment to a comprehensive response to accelerate progress on the implementation of Sustainable Development Goals (SDGs) and the Paris Agreement in the region. They stressed their concerns about the repercussions of the Covid-19 crisis, especially in developing and least developed countries, where it has set back progress towards the 2030 Agenda for Sustainable Development. In this context, participants committed to finding ways and means to continue providing financial support to the achievement of the SDGs while identifying a number of priority areas for cooperation such as connectivity and sustainable infrastructure development, energy transition, resilience of population and territories, health, and tackling  climate change and biodiversity loss, which will affect billions of lives in the Indo-Pacific. Participants agreed to meet regularly to follow up the discussions launched by the first SUFIP event.

Advocating for the Sustainable Development Agenda of the Indo-Pacific
  • Participants agreed on the requirement to support a sustainable development agenda within the Indo-Pacific. The sustainable development component of the Indo-Pacific region is at the heart of the region’s geo-economic challenges and strategies focused on this region. For the participants, promoting sustainable, resilient and inclusive projects in Indo-Pacific is crucial.
  • The crucial role of development financial institutions, bi and multilateral development banks in finding shared, effective solutions was also emphasized, and participants agreed to further strengthen the common response to the Indo-Pacific requirements of more sustainable financing, paving the way for a global response, with particular regard to the needs of the most vulnerable. The contribution of the European Union’s new development instruments and Team Europe Initiatives was recalled in that regard.
  • As the Indo-Pacific remains an open and inclusive area of cooperation, Participants agreed to put forth their best efforts to mobilize stakeholders beyond the region’s perimeter. They reaffirmed their belief in the benefits of an open and inclusive approach. 
Mobilizing appropriate financial tools to address Indo-Pacific Sustainable Development issues
  • Participants agreed to initiate a regular high-level dialogue on issues related to the achievement of the SDGs which inter-alia includes, biodiversity conservation and fight against climate change at the Indo-Pacific level, in order to identify potential areas for cooperation, such as natural disaster prevention, blue economy, biodiversity, sustainable fishing, coastal erosion, and connectivity, amongst others. This is consistent with the EU Strategy for Cooperation in the Indo-pacific as well as the European Global Gateway strategy
  • Participants recognized the importance of strengthening the alignment of all sources of financing for sustainable development with the SDGs and the need to address the related financing gaps, in line with existing commitments. They stated they would seek operations that demonstrate their willingness to collaborate in the Indo-Pacific region and push public and private actors to join their forces, through loans, concessions, grants, guarantee, equity, funds, and sustainable investments. 
  • Participants highlighted they remained determined to promote an integrated approach of investment financing for a sustainable development of the Indo-Pacific. They stressed the importance of using all available tools, including the mobilization of technical support: to identify the investments that are best suited and can have greater impacts; to support the implementation of projects with structured technical assistance; to strengthen the capacity of the stakeholders; to ensure that infrastructure management and maintenance is carried out in a durable manner over time. 
Proposals for actions on connectivity, climate finance, energy & resilience
  • Connectivity. The discussion related to connectivity issues recognized the critical role of quality and transparent infrastructure investments to match the financial and economic needs of Indo-Pacific countries. The key role of European and Indo-Pacific public development banks for providing development finance was highlighted, specifically in order to ensure both strategic autonomy and infrastructure modernization. Participants called for action and joint work to create a consistent vision of the future of connectivity in the region and materialize it by mobilizing public and private investments to catalyze finance for sustainable infrastructure. 
  • Climate Finance. On climate, the discussions highlighted the importance of a full and effective implementation of the UNFCCC and of the Paris Agreement, taking action in both mitigation and adaptation. The need to scale up and to encourage the implementation of Nature Based Solutions or Ecosystems based approaches in the projects was also underlined. It was deemed useful to draw financial tools that develop nexus between Climate Finance and Biodiversity preservation, whenever possible. Participants agreed on the key role PDBs and financial institutions could play in ensuring the conservation, protection and sustainable use of natural resources in the Indo-Pacific, and the need to strengthen action to halt and reverse biodiversity loss by 2030.
  • Energy. Discussions on energy showed that participants are aware of the barriers to the development of renewable energy in the region. New renewable energy projects in the region, from small scale to large interconnected networks, could be promoted by facilitating developing and least developed countries towards development of local manufacturing capacities, and making them self-reliant. The need for a comprehensive approach to energy transition, in order to ensure fair and just transition processes, was underlined. Co-operation between development finance institutions, national authorities and banks towards greener energies could be enhanced for that purpose. 
  • Resilience and Social Aspects. The discussions on resilience and social aspects stressed the importance that PDB and public finance institutions contribute to achieve the health-related SDGs in the Indo-Pacific and to ensure the well-being of communities. In the post-pandemic context, Participants recognize the need of effective social protection systems and quality health-infrastructure. They also noted the necessity of paying a specific attention to the inclusiveness of all essential services, to guarantee the access to the most vulnerable, keeping a gender-sensitive lens. The Partners also deliberated on working with the partner countries to develop pharmaceutical production capacities in the Indo Pacific region and diversify their pharmaceutical supply chains, while addressing international supply chain bottlenecks. Convinced about the benefits of promoting a One Health approach at the Indo Pacific level, Participants acknowledged the interdependency between people’s, animals’ and the ecosystems’ health and the importance of  seeking projects that are aligned with the sustainable, inclusive and resilient pathways the Indo-Pacific countries are advocating for.

As a conclusion, AFD and the India Exim Bank (EXIM) have expressed their thanks to the participants for joining in the first Sustainable Finance in the Indo-Pacific (SUFIP) meeting organized in Paris on February 21st, 2022. They welcome the presence of the EU special Envoy for the Indo-pacific who were invited to conclude the conference, ahead of the Ministerial Forum on Indo-Pacific that would occur the next day.  They look forward to deepen discussions during the 2nd edition, due to take place in 2023. 

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