FMO provides scarce private equity for clean technology in Mekong region
FMO, together with the Asian Development Bank (ADB), BIO and Finnfund, will invest in the new Mekong Brahmaputra Clean Development Fund. The fund, with a target size of USD100m, is set up to support clean energy projects in the Greater Mekong Sub-region (GMS) and South Asia. FMO invests USD12,5m in equity through its Infrastructure Development Fund, which it manages on behalf of the Dutch Ministry of Foreign Affairs (Development Cooperation). ADB will also invest USD12,5m, BIO USD5m, Finnfund USD8m and Dragon Capital as fund manager will invest USD 5m.
The Fund will provide scarce long term capital to clean technology companies engaged in renewable energy, energy efficiency, water conservation and waste recycling projects. Fund manager Dragon Capital Clean Development Investments Ltd.expects to invest in at least 10 clean energy and environment projects by 2014. The development impact of this fund comprises both the provision of access to renewable energy and the contribution to the development of clean energy supply as part of the economic development in the region. The investors expect to create at least 900 permanent jobs and another 7000 temporary jobs (with an average of 2 years) with this fund.
In 2008, 83 percent of households in Cambodia, 80 percent in Laos, and over 50 percent in Vietnam still used wood for fuel, making it critical to increase sustainable energy investments. Strong economic growth throughout Asia has already put substantial pressure on the region’s resources and is straining the environment. Further economic development in the Greater Mekong Sub-region and South Asia requires greater access to energy.
The DFIs expect that their participation in the fund will encourage other private sector players to also invest in clean energy projects that generate both attractive rates of return and a cleaner, more sustainable future.
The Netherlands Development Finance Company (FMO) is the international development bank of the Netherlands. FMO invests risk capital in companies and financial institutions in developing countries. With an investment portfolio of € 4.6 billion, FMO is one of the largest bilateral private sector development banks worldwide. Thanks in part to its relationship with the Dutch government, FMO is able to take risks which commercial financiers are not - or not yet - prepared to take. FMO's mission: to create flourishing enterprises, which can serve as engines of sustainable growth in their countries.
Nicoline van Slingelandt
Communications Officer (PR)
T: +31 70 314 9790
M: +31 622 563 047