UK and UN ESCAP collaborate to boost green investment in Southeast Asia

The UK Government and the United Nations Economic and Social Commission for Asia and the Pacific (UN ESCAP) have joined forces to launch the ASEAN Green Investment Catalyst (AGIC) initiative, a significant step in accelerating sustainable foreign direct investment (FDI) across Southeast Asia. This £2.1 million programme is funded through the ASEAN-UK Green Transition Fund and marks a pivotal collaboration aimed at channeling FDI into green sectors essential for ASEAN’s transition to a low-carbon economy.

The AGIC initiative seeks to implement the ASEAN Regional Investment Promotion Action Plan, a coordinated effort adopted by ASEAN Economic Ministers in September 2024. This strategic plan represents the region’s first unified approach to attracting green investment, signalling a landmark shift toward sustainable economic growth and climate resilience.

Armida Salsiah Alisjahbana, United Nations Under-Secretary-General and Executive Secretary of ESCAP, emphasised the importance of the initiative in addressing the urgent need for private climate-focused investments. By fostering regional collaboration and enhancing investment strategies, the programme aims to position ASEAN as a premier destination for sustainable investment, aligning with its broader goals for economic inclusivity and environmental stewardship.

Strategic Importance of the AGIC Initiative

The AGIC project stands out for its innovative methodology, which includes creating investment-ready projects in green transition sectors and a specialised tool to connect these projects with global investors. By developing a sustainable pipeline of green investments, the programme aims to attract cross-border FDI and build capacity among ASEAN Investment Promotion Agencies. Additionally, the project will contribute to the ASEAN Investment Forum in 2025 and 2026, showcasing green investment opportunities to a global audience.

UK Ambassador to ASEAN, Sarah Tiffin, highlighted the UK’s commitment to climate finance and its leadership in supporting ASEAN’s climate ambitions through the Green Transition Fund. This initiative, she noted, exemplifies the transformative potential of UK-ASEAN cooperation in advancing net-zero goals while fostering economic opportunities.

Alignment with Broader Climate Goals

The AGIC initiative reflects a confluence of priorities between the UK, ASEAN, and ESCAP. It aligns with the ASEAN-UK Plan of Action (2022-2026) and builds upon the UK’s COP26 legacy of mobilising climate finance. By facilitating regional collaboration and innovation in investment strategies, the project strengthens ASEAN’s capacity to attract sustainable development financing.

The ASEAN-UK Green Transition Fund, the financial backbone of this initiative, is a five-year programme with up to £40 million allocated between 2024 and 2029. It focuses on reducing emissions in key sectors, driving green economic growth, and enhancing the livelihoods of vulnerable populations across all ASEAN member states and Timor-Leste.