MUFG Bank, a consolidated subsidiary of Mitsubishi UFJFinancial Group, Inc. (MUFG), announced that today it signed a Memorandum ofUnderstanding with Nippon Export and Investment Insurance Co., Ltd., (NEXI) for thepurpose of establishing a financing scheme using blended finance for the Asian ZeroEmissions Community (AZEC) and other projects.
Blended finance is a financing method that combines public and private funds and isexpected to effectively support developing countries’ efforts to solve issues they areconfronting. In particular, Asia, which has a large number of developing countries, needsan investment and financial framework to gradually decarbonize its economy forsustainable growth. The Japanese government has announced the Asian ZeroEmissions Community initiative1, which seeks to promote an energy transition throughwide-area partnerships with Asian countries, and is taking the lead in decarbonizationand economic growth in line with the realities in Asia. In addition, the Japanesegovernment’s Asian Energy Transition Initiative (AETI)2 is studying comprehensivemeasures for supporting decarbonization in Asia, including the launch of the AsiaTransition Finance Study Group (ATFSG)3 led by major financial institutions in ASEANcountries. As a member of the ATFSG’s secretariat, MUFG Bank has led discussionswith financial institutions and government agencies to develop international guidelines.
The purpose of this agreement is for MUFG Bank and NEXI to cooperate to establish afinancing scheme using blended finance for the purpose of realizing an effective energytransition in Asia, addressing the issue of climate change, and meeting the economic andsocial demands of eliminating poverty, sustainable economic growth, and a stable energysupply. We will also consider introducing public and private funds in the form of debtfunding as a framework for investments and loans to support decarbonization accordingto each country’s circumstances. Initiatives under this agreement are consistent with theobjectives of the Japanese government-led AZEC and AETI.
MUFG Bank will further contribute to the sustainable development of Asia and therealization of a phased energy transition by utilizing its financial schemes and riskmanagement techniques that contribute to the resolution of environmental and socialissues, as well as knowledge gained through the ATFSG.
Overview of NEXI
Name - Nippon Export and Insurance Co., Ltd.
Representative - Atsuo Kuroda, President and Chief Executive Officer
Address - East Building, Chiyoda First Building, 8-1, Nishikanda 3-Chome, Chiyoda-ku, Tokyo
Website - https://www.nexi.go.jp/
Mitsubishi UFJ Financial Group, Inc. (MUFG) is one of the world’s leading financialgroups. Headquartered in Tokyo and with over 360 years of history, MUFG has a globalnetwork with approximately 2,000 locations in more than 50 countries. The Group hasabout 160,000 employees and offers services including commercial banking, trustbanking, securities, credit cards, consumer finance, asset management, and leasing.The Group aims to “be the world’s most trusted financial group” through closecollaboration among our operating companies and flexibly respond to all of the financialneeds of our customers, serving society, and fostering shared and sustainable growthfor a better world. MUFG’s shares trade on the Tokyo, Nagoya, and New York stockexchanges. For more information, visit https://www.mufg.jp/english.
1. A framework for Asian countries to cooperate in decarbonization and energy transition, set out in a policy speechby Prime Minister Fumio Kishida in January 2022. Please refer to the following link for information about theMinisterial Meeting of the Asian Zero Emissions Community held in March 2023.https://www.meti.go.jp/press/2022/03/20230306005/20230306005.html (Japanese)
2. For more information about the Asian Energy Transition Initiative, which was announced by the Ministry of Economy,Trade and Industry in May 2021, please refer to the following link:https://www.meti.go.jp/press/2021/05/20210528007/20210528007-1.pdf (Japanese)
3. For the Asia Transition Finance Study Group, please refer to the following link:https://www.bk.mufg.jp/news/news2022/pdf/news0926_2.pdf (Japanese)
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