Climate Finance Partnership Raises US$250 Million at First Close to Invest in Emerging Market Climate Infrastructure
Global Consortium of Ten Investors Including Governments, Philanthropies, and Institutional Investors Commit Initial Capital to Help Reduce Carbon Emissions in Emerging Markets
NEW YORK–(BUSINESS WIRE)–BlackRock has secured more than US$250 million in commitments from a consortium of global institutional investors, governments and philanthropies for the Climate Finance Partnership (CFP), a flagship blended finance vehicle focused on investing in climate infrastructure across emerging markets in order to accelerate the global transition to a low carbon economy. Conceived at the One Planet Summit in September 2018 under the leadership of French President Emmanuel Macron, CFP showcases the potential for the public, philanthropic and private sectors to work together to mobilize significant investment into climate infrastructure that can deliver positive environmental and social impact and allow for attractive risk-adjusted returns.
The Governments of France, through the French Development Agency (AFD); Germany, through KfW Development Bank (KfW); and Japan, through Japan Bank for International Cooperation (JBIC); together with the Grantham Environmental Trust, the Quadrivium Foundation, and another private foundation committed a combined US$112.5 million in catalytic capital. This catalytic capital is being used to mobilize a broader institutional capital raise, starting with commitments from Dai-ichi Life Insurance, a leading European pension fund, and a key strategic banking partner, Standard Chartered Bank, as well as MUFG Bank, which together are the first institutional investors in CFP.
With energy demand in emerging markets poised to double by 2050, there is significant capital required for climate infrastructure, such as renewable power, in these regions to help reduce carbon emissions. Approximately US$9 trillion is needed for emerging markets to derive two-thirds of their energy from renewable power by 20501. The global energy transition toward net zero by 2050 can only be achieved with more institutional capital flows into less developed regions, where there are acute challenges from population growth, rising energy demand and climate disruption. CFP’s unique structure is designed to invest in new solutions that can help communities in developing countries that are most vulnerable to the impacts of climate change.
It is the shared belief of all CFP parties that aggressive action is necessary in order to limit the global temperature increase to 1.5°C, in a manner that harnesses the economic opportunities embedded in the transition to a global low-carbon economy.
“We are honored to collaborate with this group of likeminded organizations from the public and private sectors to raise initial capital that will be used to help unlock the energy transition in emerging markets through the Climate Finance Partnership,” said Edwin Conway, Global Head of BlackRock Alternative Investors.
CFP will target investments in select countries in Asia, Latin America, and Africa. The fund’s focus on the climate infrastructure sector include: (i) grid connected and/or distributed renewable power generation; (ii) energy efficiency in residential, commercial and/or industrial sectors; (iii) transmission or energy storage solutions; and (iv) ultra-low emission or electrified transportation and mobility services. The Partnership is targeting at least US$500 million and is delighted to have secured half of its target at first close.
Rémy Rioux, CEO of the French Development Agency (AFD), said, “The unique challenges posed by climate change call for stronger joint action, public and private. It is therefore with great pride that the AFD Group, through its private-sector subsidiary PROPARCO, is partnering with BlackRock, the largest asset manager worldwide, to accelerate the mobilization of private-sector financing toward climate. This ambitious partnership, forged with Germany, Japan and leading global foundations, will help redirect financial flows toward sustainable development investments across the emerging world, with a priority to Africa as a key continent to France and Europe and one of the most vulnerable regions to climate change despite contributing the least to global warming. Our partnership illustrates the power of the Finance in Common (FiCS) movement, regrouping all Public Development Banks (PDBs) to co-invest with private financiers.”
State Secretary Jochen Flasbarth from the German Ministry for the Environment, Nature Conservation and Nuclear Safety, said, “I am excited that the Climate Finance Partnership is now aiming to bring additional institutional capital on board for investments in the energy transition in emerging markets. We are supporting this Partnership because we believe that combining the strengths of the public and private sectors is necessary in order to align finance flows with low-carbon and climate-resilient development. The Paris Agreement requires nothing less from us than the climate-friendly transformation of the financial sector.“
Tadashi Maeda, Governor of JBIC, said, “Since 2020, the world’s imminent challenge has been to overcome the COVID-19 pandemic and reinvigorate the economy. Simultaneously, the international community is striving to achieve sustainable development and energy transition toward a decarbonized society. With that in mind, the Government of Japan aims to reduce GHG emissions to net-zero, and realize a carbon-neutral society by 2050. Participating in CFP as a catalytic partner is in line with such mission and we are pleased to contribute to the sustainable development of developing countries and provision of private capital to low-carbon investment opportunities. We will continue our efforts to create an eco-system that encourages innovation for decarbonization and achieves effective energy transition, thereby contributing to the global agenda.”
Seiji Inagaki, President and Representative Director, The Dai-ichi Life Insurance Company, Limited, said, “As an institutional investor, Dai-ichi Life aims to achieve zero carbon by 2050. We actively pursue climate-related opportunities by investing in and financing projects such as renewable power to create positive impacts. We believe CFP will greatly contribute to solving various issues in emerging countries such as decarbonization, and we are pleased to invest in this fund.”
Simon Cooper, CEO, Corporate, Commercial & Institutional Banking and CEO, Europe & Americas, Standard Chartered Bank, said, “The CFP’s objective, to invest in a diversified portfolio of climate infrastructure in emerging markets, can help bring about positive environmental and social impact in line with the United Nations’ Sustainable Development Goals. This fits squarely with our aims at Standard Chartered to mobilize finance to where it matters most.”
Hironori Kamezawa, President & Group CEO, Mitsubishi UFJ Financial Group, said, “MUFG Bank appreciates this opportunity to expand our support of bringing more renewable energy to emerging markets where it is truly needed. CFP’s focus fits well with our commitment to responsible investment and our declaration to reach carbon neutrality by 2050.”
About BlackRock
BlackRock’s purpose is to help more and more people experience financial well-being. As a fiduciary to investors and a leading provider of financial technology, we help millions of people build savings that serve them throughout their lives by making investing easier and more affordable. For additional information on BlackRock, please visit www.blackrock.com/corporate
Disclosures
Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. Investors may not get back the amount originally invested. Past performance is not a reliable indicator of current or future results and should not be the sole factor of consideration when selecting a product or strategy. Changes in the rates of exchange between currencies may cause the value of investments to diminish or increase. Fluctuation may be particularly marked in the case of a higher volatility fund and the value of an investment may fall suddenly and substantially. Levels and basis of taxation may change from time to time. Tax treatment depends on the individual circumstances of each client and may be subject to change in the future.
Infrastructure Funds. Infrastructure Funds invest exclusively or almost exclusively in equity or debt, or equity or debt related instruments, linked to infrastructure assets. Therefore, in addition to risks associated with investment in such equity or debt instrument, the performance of an Infrastructure Fund may be materially and adversely affected by risks associated with the related infrastructure assets including construction and operator risks, environmental risks, legal and regulatory risks; political or social instability; governmental and regional political risks; sector specific risks; interest rate changes; currency risks; and other risks and factors which may or will impact infrastructure and as a result may substantially affect a fund’s aggregate return. Investments in Infrastructure assets are typically illiquid and investors seeking to redeem their holdings in an Infrastructure Fund can experience significant delays and fluctuations in value.
Liquidity Risk. The Fund’s investments may have low liquidity which often causes the value of these investments to be less predictable. In extreme cases, the Fund may not be able to realise the investment at the latest market price or at a price considered fair.
Valuation risk. The Fund will be exposed to securities and other assets that will not have readily assessable market values. The valuation of such securities and other assets is inherently subjective and subject to increased risk that the information utilised to value such assets or to create the price models may be inaccurate or subject to other error. Due to a wide variety of market factors and the nature of the securities and assets to which the Fund will be exposed, there is no guarantee that any value determined will represent the value that will be realised on the eventual disposition of the Fund’s investments or that would, in fact, be realised upon an immediate disposition of such investment.
Lack of available investments. The Fund will be competing for exposure to investments in a highly competitive market, against other funds, as well as individuals, financial institutions, strategic players and other investors, some of which may have greater resources than the Investment Manager. There can be no assurance that the Fund will be able to locate, attain and exit investments that satisfy its investment objectives, or that the Fund will be able to fully invest its committed capital.
Redemption risk. The Fund’s investments are generally illiquid and therefore an investment in the Fund is intended for long-term investors able to accept the risks associated with an illiquid investment and who are able to commit their funds for the duration of the Fund Redemptions, to the extent they are permitted, may be limited, postponed or altogether suspended in certain circumstances.
Important Information This material is for distribution to Professional Clients (as defined by the Financial Conduct Authority or MiFID Rules) only and should not be relied upon by any other persons.
Until 31 December 2020, issued by BlackRock Investment Management (UK) Limited, authorised and regulated by the Financial Conduct Authority. Registered office: 12 Throgmorton Avenue, London, EC2N 2DL. Tel: + 44 (0)20 7743 3000. Registered in England and Wales No. 02020394. For your protection telephone calls are usually recorded. Please refer to the Financial Conduct Authority website for a list of authorised activities conducted by BlackRock. From 1 January 2021, in the event the United Kingdom and the European Union do not enter into an arrangement which permits United Kingdom firms to offer and provide financial services into the European Economic Area, the issuer of this material is: (i) BlackRock Investment Management (UK) Limited for all outside of the European Economic Area; and (ii) BlackRock (Netherlands) B.V. for in the European Economic Area, BlackRock (Netherlands) B.V. is authorised and regulated by the Netherlands Authority for the Financial Markets. Registered office Amstelplein 1, 1096 HA, Amsterdam, Tel: 020 – 549 5200, Tel: 31-20-549-5200. Trade Register No. 17068311 For your protection telephone calls are usually recorded.
For Investors in Switzerland: For Qualified Investors only. This document is marketing material.Until 31 December 2021, this document shall be exclusively made available to, and directed at, qualified investors as defined in the Swiss Collective Investment Schemes Act of 23 June 2006 (“CISA”), as amended.
From 1 January 2022, this document shall be exclusively made available to, and directed at, qualified investors as defined in Article 10 (3) of the CISA of 23 June 2006, as amended, at the exclusion of qualified investors with an opting-out pursuant to Art. 5 (1) of the Swiss Federal Act on Financial Services (“FinSA”).
For information on art. 8 / 9 Financial Services Act (FinSA) and on your client segmentation under art. 4 FinSA, please see the following website: www.blackrock.com/finsa.
The Climate Finance Partnership Fund SCSp is domiciled in Luxembourg. The Fund has not been registered with the Swiss Financial Market Supervisory Authority (FINMA). Representative in Switzerland is BlackRock Asset Management Switzerland Limited, Bahnhofstrasse 39, CH-8001 Zurich and the Paying Agent in Switzerland is State Street Bank International GmbH, München, Zweigniederlassung Zürich, Beethovenstrasse 19, CH -8002 Zürich. The Fund’s confidential Private Placement Memorandum and/or any other offering materials and the annual and semi-annual reports, if applicable, of the Fund/s are available free of charge from the representative in Switzerland. Investors should read the fund specific risks in the Prospectus and any other offering material.
For investors in the Caribbean: Any funds mentioned or inferred in this material have not been registered under the provisions of the Investment Funds Act of 2003 of the Bahamas, nor have they been registered with the securities regulators of Bermuda, Dominica, the Cayman Islands, the British Virgin Islands, Grenada, Trinidad & Tobago or any jurisdiction in the Organization of Eastern Caribbean States, and thus, may not be publicly offered in any such jurisdiction. The shares of any fund mentioned herein may only be marketed in Bermuda by or on behalf of the fund or fund manager only in compliance with the provision of the Investment Business Act 2003 of Bermuda and the Companies Act of 1981. Engaging in marketing, offering or selling any fund from within the Cayman Islands to persons or entities in the Cayman Islands may be deemed carrying on business in the Cayman Islands. As a non-Cayman Islands person, BlackRock may not carry on or engage in any trade or business unless it properly registers and obtains a license for such activities in accordance with the applicable Cayman Islands law.
For Investors in Mexico: FOR INSTITUTIONAL AND QUALIFIED INVESTORS USE ONLY. INVESTING INVOLVES RISK, INCLUDING POSSIBLE LOSS OF PRINCIPAL. THIS MATERIAL IS PROVIDED FOR EDUCATIONAL AND INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE AN OFFER OR SOLICITATION TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SHARES OF ANY FUND OR SECURITY. This information does not consider the investment objectives, risk tolerance or the financial circumstances of any specific investor. This information does not replace the obligation of financial advisor to apply his/her best judgment in making investment decisions or investment recommendations. It is your responsibility to inform yourself of, and to observe, all applicable laws and regulations of Mexico. If any funds, securities or investment strategies are mentioned or inferred in this material, such funds, securities or strategies have not been registered with the Mexican National Banking and Securities Commission (Comisión Nacional Bancaria y de Valores, the “CNBV”) and thus, may not be publicly offered in Mexico. The CNBV has not confirmed the accuracy of any information contained herein. The provision of investment management and investment advisory services (“Investment Services”) is a regulated activity in Mexico, subject to strict rules, and performed under the supervision of the CNBV. These materials are shared for information purposes only, do not constitute investment advice, and are being shared in the understanding that the addressee is an Institutional or Qualified investor as defined under Mexican Securities (Ley del Mercado de Valores). Each potential investor shall make its own investment decision based on their own analysis of the available information. Please note that by receiving these materials, it shall be construed as a representation by the receiver that it is an Institutional or Qualified investor as defined under Mexican law. BlackRock México Operadora, S.A. de C.V., Sociedad Operadora de Fondos de Inversión (“BlackRock México Operadora”) is a Mexican subsidiary of BlackRock, Inc., authorized by the CNBV as a Mutual Fund Manager (Operadora de Fondos), and as such, authorized to manage Mexican mutual funds, ETFs and provide Investment Advisory Services. For more information on the Investment Services offered by BlackRock Mexico, please review our Investment Services Guide available in www.blackrock.com/mx. This material represents an assessment at a specific time and its information should not be relied upon by the you as research or investment advice regarding the funds, any security or investment strategy in particular. Reliance upon information in this material is at your sole discretion. BlackRock México is not authorized to receive deposits, carry out intermediation activities, or act as a broker dealer, or bank in Mexico. For more information on BlackRock México, please visit: www.blackRock.com/mx. BlackRock receives revenue in the form of advisory fees for our advisory services and management fees for our mutual funds, exchange traded funds and collective investment trusts. Any modification, change, distribution or inadequate use of information of this document is not responsibility of BlackRock or any of its affiliates. Pursuant to the Mexican Data Privacy Law (Ley Federal de Protección de Datos Personales en Posesión de Particulares), to register your personal data you must confirm that you have read and understood the Privacy Notice of BlackRock México Operadora. For the full disclosure, please visit www.blackRock.com/mx and accept that your personal information will be managed according with the terms and conditions set forth therein.
For investors in Israel: BlackRock Investment Management (UK) Limited is not licensed under Israel’s Regulation of Investment Advice, Investment Marketing and Portfolio Management Law, 5755-1995 (the “Advice Law”). No action has been taken or will be taken in Israel that would permit a public offering or distribution of the products mentioned in this document to the public in Israel. The products mentioned in this document have not been approved by the Israel Securities Authority. In addition, the products mentioned in this document are not regulated under the provisions of Israel’s Joint Investment Trusts Law, 5754-1994 (the “Joint Investment Trusts Law”). This document has not been approved by the Israel Securities Authority and will only be distributed to Israeli residents in a manner that will not constitute “an offer to the public” under sections 15 and 15a of the Israel Securities Law, 5728-1968 (the “Securities Law”) or section 25 of the Joint Investment Trusts Law, as applicable.
This document and the products mentioned herein are being offered to those categories of investors listed in the First Addendum (the “Addendum”) to the Securities Law, (“Institutional Investors”); in all cases under circumstances that will fall within the private placement or other exemptions of the Joint Investment Trusts Law, the Securities Law and any applicable guidelines, pronouncements or rulings issued from time to time by the Israel Securities Authority. This document may not be reproduced or used for any other purpose, nor be furnished to any other person other than those to whom copies have been sent. Nothing in this document should be considered investment advice or investment marketing as defined in the Regulation of Investment Advice, Investment Marketing and Portfolio Management Law, 5755-1995. This document does not constitute an offer to sell or solicitation of an offer to buy any securities, nor does it constitute an offer to sell to or solicitation of an offer to buy from any person or persons in any state or other jurisdiction in which such offer or solicitation would be unlawful, or in which the person making such offer or solicitation is not qualified to do so, or to a person or persons to whom it is unlawful to make such offer or solicitation.
For recipients in Hong Kong: This document is provided by BlackRock Asset Management North Asia Limited. The Fund mentioned herein has not been registered with the Securities and Futures Commission for offering or distribution in Hong Kong. Accordingly, this material may not be circulated or distributed, nor may the Funds be offered or sold whether directly or indirectly, to any person in Hong Kong other than to a Professional Investor as defined in the Securities and Futures Ordinance (“SFO”) (Cap. 571 of the laws of Hong Kong) and any regulations there under. Investments involve risks. Past performance is not a guide to future performance. This material is provided for informational or educational purposes only and does not constitute a solicitation of any securities or BlackRock funds in any jurisdiction in which such solicitation is unlawful or to any person to whom it is unlawful. Moreover, it neither constitutes an offer to enter into an investment agreement with the recipient of this document nor an invitation to respond to it by making an offer to enter into an investment agreement. Before making an investment decision, investors should read the relevant offering documents carefully including the investment objective and risk factors relating to the Fund.
For investors in Singapore, this information is issued by BlackRock (Singapore) Limited (company registration number: 200010143N) for use only by institutional investors as defined in Section 4A of the Securities and Futures Act, Chapter 289 of Singapore and should not be relied upon by or redistributed to any other persons in Singapore. The fund mentioned herein have not been registered with the Monetary Authority of Singapore for offering or distribution in Singapore. Accordingly, this information may not be circulated or distributed, nor may the funds be offered or sold whether directly or indirectly, to any person in Singapore other than (i) to an institutional investor pursuant to Section 304 of the Securities and Futures Act (“SFA”) or (ii) otherwise pursuant to and in accordance with the conditions of any other applicable provision of the SFA. This advertisement or publication has not been reviewed by the Monetary Authority of Singapore.
In Australia & New Zealand, issued by BlackRock Investment Management (Australia) Limited ABN 13 006 165 975, AFSL 230 523 (BIMAL) for the exclusive use of the recipient, who warrants by receipt of this material that they are a wholesale client as defined under the Australian Corporations Act 2001 (Cth) and the New Zealand Financial Advisers Act 2008 respectively.
Contacts
Media Contact
Christopher Beattie
+1 646 231-8518
christopher.beattie@blackrock.com