SINGAPORE: Temasek will set aside S$100 million (US$77.5 million) as concessional capital to support climate action initiatives, announced chairman Lim Boon Heng on Monday (Sep 23).

“The aim is to crowd in capital to support marginally bankable projects,” said Mr Limoogbet at the state investor’s 50th anniversary dinner held at the Shangri-La Hotel.

“We believe there can be a catalytic effect by mobilising funding from other sources such as public, private and philanthropic capital providers. Our philanthropic dollar will be amplified as more funding goes towards climate action.”

This is the first time Temasek is contributing concessional capital – defined as a type of capital that is willing to absorb more risks or take a lower return – to drive the green transition.

The firm has been investing in sustainability – with a “sustainable living” portfolio valued at S$44 billion – but said it is seeing “the criticality of concessional capital to catalyse financing into emerging markets and developing economies” where the net-zero transition has been hindered by structural constraints and challenges.

Southeast Asia is one example where plans to decarbonise and build new industries concurrently will require the scaling of catalytic financing, it said.

Temasek added that its concessional capital will provide “more flexible, patient and favourable financing” that can address challenges such as emerging market risks and a higher cost of capital.

Success of its latest initiative will be measured by the “ability to scale positive outcomes in the area of climate action”.

These include the ability to avoid, mitigate and adapt to the impact of climate change, promote biodiversity and encourage sustainable living choices, among others, it said.

Related:Temasek's net portfolio value grows by S$7 billion to S$389 billion, boosted by US and India investments Singapore's Temasek unveils S$44 billion 'sustainable living' portfolio

Temasek, which celebrates its 50th anniversary in 2024, has marked the year with other initiatives such as the set-up of a S$150 million fund for skills training and talent development in Singapore.

On Monday, it launched a commemorative book – titled “By Generations, For Generations: Fifty Years of Temasek As Told By The People Who Shaped It’’ – that captures the firm’s key events and milestones over the past five decades.

The book is written by former journalist Ong Soh Chin who interviewed about 90 staff, alumni and business partners.

Mr Lim, who has been chairman of Temasek since 2013, said the state investor has faced “countless dark clouds” since it was started in 1974 as a holding company for the government’s assets.

Chairman of Temasek Lim Boon Heng speaks at Temasek’s 50th anniversary dinner at Shangri-La Hotel on Sep 23, 2024. (Photo: CNA/Syamil Sapari)

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