Can banks justify financing new coal projects in Southeast Asia because developing countries are still dependent on fossil fuels for energy? This was the question at the centre of debate at a sustainable finance event in the city-state on Friday morning. The Unlocking Capital for Sustainability forum, organised by Eco-Business, gathered more than 150 business, government and civic society leaders for a conversation on how to get capital markets to fund sustainable projects around the region.
It comes at a time when the financial sector is under the spotlight for financing coal-fired power plants. Singapore’s largest bank, DBS, released a climate policy—a first for the region— last week that pledged to stop financing new coal-fired power plants, but only in developed countries. The bank’s position on coal, which is shared by many other Asian banking institutions, is that developing countries still depend on coal to power their economies and meet expanding energy demand in a way that is affordable, and the transition to clean alternatives is not yet feasible.