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Green Infrastructure
Investment Opportunities
MALAYSIA
2020 REPORT
Supported by Capital Markets Malaysia
Malaysia GIIO Report Climate Bonds Initiative 1
1. Sponsor’s note
Malaysia has a long and successful history in advocating the use of Islamic finance and
Islamic capital market instruments. As one of the largest issuers of Sukuk (Islamic bonds)
globally, the country’s financial regulators and industry players have been at the forefront
of innovation in Islamic finance. This is exemplified by the leadership role it has played in
leveraging the collective Islamic finance expertise of its market players to create Shariah-
compliant green and sustainable finance instruments.
The issuance of the Sustainable and Responsible Investment (SRI) Sukuk Framework in 2014
by the Securities Commission Malaysia (SC) marked a pivotal milestone in Malaysia’s journey
in building a sustainable finance and investing ecosystem – one that would be intertwined
with and facilitated by the country’s significant leadership in the Islamic capital market.
This report details the green investment opportunities in renewable energy, green buildings,
low carbon transport and water management, available in Malaysia. In addition, it highlights
how green Sukuk has been leveraged on, to fund green projects.
Since the world’s first green Sukuk issuance in 2017 by Tadau Energy in Malaysia, Malaysian
issuers have issued a total of 13 green Sukuk and bonds to finance a range of projects
including large-scale solar farms, green buildings and a mini-hydropower plant.
Malaysia’s development in this space is due in no small part to our financial sector
intermediaries who have demonstrated a strong commitment to building a holistic sustainable
finance ecosystem and have displayed innovation in structures and breadth of product offerings.
For its part, Malaysia’s financial regulators have endeavoured to create an enabling ecosystem
for green finance transactions, including the introduction of tax incentives, grants and capacity
building to strengthen and support its financial sector intermediaries.
Capital Markets Malaysia, as an affiliate of the SC, plays a unique role in supporting the
country’s sustainable finance ecosystem. With a mandate to position and profile, whilst
also supporting development in this space, it is our hope that this Green Infrastructure
Investment Opportunities Report conveys the noteworthy green investment opportunities
available in Malaysia.
Sincerely,
Zalina Shamsudin
General Manager, Capital Markets Malaysia
About Capital Markets Malaysia
As part of its developmental mandate, participation and enhance opportunities for CMM also continuously engages with
the Securities Commission Malaysia Malaysian capital market intermediaries. the capital market regulator, providing
(SC) set up Capital Markets Malaysia market insights, business development
CMM engages with a wide range of
(CMM) to spearhead both the local and stakeholder engagement support to
international and domestic stakeholders,
and international positioning and market development initiatives.
connecting local capital market
profiling of the Malaysian capital
intermediaries to foreign stakeholders and
market. CMM profiles the
providing a global platform to position
competitiveness and attractiveness
Malaysia’s unique capital market offerings
of the various segments of the capital
and expertise. As an affiliate of the SC,
market to increase international
Malaysia GIIO Report Climate Bonds Initiative 2
2. Introduction
This report highlights green infrastructure investment opportunities in Malaysia. It has
been prepared to help meet the growing demand for green investment opportunities and to
support the country’s transition to a low carbon economy.
It aims to facilitate greater engagement on this topic between project owners and developers,
and institutional investors. Green infrastructure and corresponding green finance instruments
are explored in the report, with sector-by-sector investment options presented.
The report is intended for a wide range of stakeholders, including domestic superannuation
funds and asset managers and their global counterparts, potential issuers, infrastructure
owners and developers, as well as relevant government ministries.
In developing this report, the Climate Bonds Initiative consulted with key Government bodies,
industry, the financial sector, peak bodies, NGOs and think tanks – in partnership with Capital
Markets Malaysia. We would like to thank these partners along with the other organisations
that contributed to the report:
Report highlights
• Malaysia needs a cumulative • SRI Sukuk and Bond Grant Scheme • There is growing momentum on
infrastructure investment of roughly was one of the first global examples of green infrastructure and the sample
USD460bn from 2016-2040. incentive structures to support green pipeline demonstrates that most of
bond issuance. the technology required is not new to
• To meet its Paris Agreement targets,
Malaysia - in particular public transport
much of this investments needs to be • Malaysia is the global leader in green
and solar energy.
directed at green infrastructure. sukuk issuance with 13 deals from 11
different issuers out of a global total of 23 • The post-COVID recovery represents
• Green finance including green bonds
deals and 16 issuers. an opportunity to focus recovery on
and sukuk will be essential to finance
green stimulus to meet Malaysia’s Paris
the transition to a low carbon economy • There is already a pipeline of green
Agreement targets.
investments in Malaysia across transport,
• Malaysia has shown global leadership
energy, water and waste infrastructure.
on sustainable finance, implementing
a range of policy support and
requirements since 2011.
Malaysia GIIO Report Climate Bonds Initiative 3
Green Infrastructure Investment Opportunities (GIIO) Table of contents
Report Series 2 1. Foreword
Green infrastructure presents a huge investment opportunity globally, with an
3 2. Introduction
estimated USD100tn worth of climate compatible infrastructure required between now
and 2030, in order to meet Paris Agreement emissions reduction targets. However, 4 3. Malaysia context
there remains limited identifiable, investment-ready and bankable projects, particularly
• Country facts
in emerging markets. There is also a lack of understanding of what types of assets and
projects qualify for green financing. • Malaysia’s macroeconomic
outlook
In response to this challenge, CBI is developing a series of reports that aim to identify
and demonstrate green infrastructure investment opportunities around the world. By • Infrastructure spending
so doing, it aims to raise awareness of what is green and where to invest, as well as to
• Malaysia’s climate policy
promote green bond issuance as a tool to finance green infrastructure.
10 4. Malaysia green finance trends
The report series commenced with the GIIO Indonesia report, launched in May 2018
and opportunities
and now includes Australia & New Zealand, Philippines, Vietnam and Brazil report. The
pipeline of GIIO reports being developed includes further exploration of opportunities • Malaysian green bond and sukuk
in Asia-Pacific as well as opportunities in Latin America. marketg
• Financing credible transitions in
Malaysia
• The role of Development Finance
Institutions (DFIs)
18 5. Deep Dive: Green sukuk
opportunities
Green Infrastructure Green Infrastructure
Investment Opportunities Investment Opportunities • Green Sukuk in Malaysia
AUSTRALIA 2019
VIETNAM
2019 REPORT
• Trends in global green sukuk
issuance
• Potential for growth of the global
sukuk market
23 6. Green infrastructure investment
opportunities
Supported by European Climate Foundation Sponsors
• Renewable energy
• Sustainable water management
• Sustainable waste management
Green Infrastructure Green Infrastructure
Investment Opportunities Investment Opportunities
AUSTRALIA & NEW ZEALAND INDONESIA • Other green opportunities
UPDATE REPORT
43 7. Measures for growing green
infrastructure
44 Appendices
• Appendix 1: Green standards in
Malaysia
Sponsors Supported by European Climate Foundation
• Appendix 2: Sample Green Pipeline
• Endnotes
Climate Bonds Initiative
The Climate Bonds Initiative (CBI) is an the cost of capital for large-scale climate and certification scheme. CBI screens
international investor-focused not-for- and infrastructure projects and to support green finance instruments against its
profit organisation working to mobilise governments seeking increased capital markets Climate Bonds Taxonomy to determine
the USD100tn bond market for climate investment to meet climate and greenhouse alignment and uses sector specific criteria
change solutions. gas (GHG) emission reduction goals. for certification.
It promotes investment in projects and The CBI carries out market analysis, The Climate Bonds Taxonomy is on the
assets needed for a rapid transition to a policy research, market development; back cover. Please see p. xx for information
low carbon and climate resilient economy. advises governments and regulators; and on the Climate Bonds Standard and
The mission focus is to help drive down administers a global green bond standard Certification Scheme.
Malaysia GIIO Report Climate Bonds Initiative 4
Green infrastructure: an opportunity for growth
Malaysia has been one of the fastest growing performs well on overall infrastructure quality (Islamic bond) issued by a Malaysian
economies in ASEAN with the third largest globally, ranking 27th out of 141 countries entity was in July 2017, by Tadau Energy,
economy in Southeast Asia and the 35th in the 2019-2020 Global Competitiveness for MYR250m (USD62.1m) with use of
largest economy in the world.1 The COVID-19 Report.6 Despite this, climate change and proceeds for renewable energy. As of 31
pandemic has put some pressure on the population growth will continue to put December 2020, green bond issuance from
country’s prospects; however, economic pressure on this infrastructure. Malaysian entities amounted to USD1.36bn9
growth is expected to rebound gradually in and includes a large segment of green sukuk.
Currently, much of the investment in
2021-2022, as global conditions improve.2
infrastructure in Malaysia is being carried In order to attract investors looking for
The process of recovery from the COVID
out through public funding and Public Private green, there needs to be a visible pipeline
crisis needs to focus on building back better,
Partnerships (PPP) ventures.7,8 However, of infrastructure investment opportunities
by prioritising green infrastructure and
public funding is not sufficient to meet the that align with internationally accepted
nurturing a regulatory environment that
growing demand for green infrastructure; definitions of green. A large and visible
facilitates green and innovative investment.
new channels will be necessary to Malaysian green infrastructure pipeline
Climate change has already had significant mobilise private capital. Existing funding could also help investors to understand that
adverse impacts on Malaysia, including commitments made by the government may there is a sufficiently large pool of financially
increased annual surface temperature and also be challenged by the current COVID attractive investments that are also green.
rainfall, sea level rise, and other extreme pandemic and ensuing economic crisis, The implication of this is that there are
weather events.3 The country is also facing so access to capital markets will be key to viable alternatives to non-green assets and
declining natural resources and increasing growing green pipelines. projects, and that investors can make their
greenhouse gas (GHGs) emissions due to preferences for green heard, which will in
Scaling up sustainable investment will
intense energy consumption for its rapid turn spur the creation of a larger pool of
depend on the Malaysian government’s level
growth.4 green investments.
of commitment to greening the economy.
Scaling-up of investment in green Policies encouraging public investment in Globally, there has been limited awareness
infrastructure is critical for Malaysia to green infrastructure have the power to set and appreciation of ‘what are green
meet its climate commitments – including Malaysia on a sustainable course for the investments’ beyond solar and wind energy.
the Paris Climate Change Agreement long run - sending an important signal to the This lack of understanding makes it difficult
- and build resilience to the impacts of market and providing an opportunity for the for governments to develop pipelines of
climate change as well as to achieve rapid country to access new capital. commercially viable, green infrastructure
economic development. As a top priority investment opportunities that are able to
Globally, there is significant demand for
for the current Malaysia administration, support the nation’s transition to a low-
green investments. Green debt instruments
infrastructure development is being heavily carbon economy.
(including green bonds and green loans)
supported and promoted in government.
that commit proceeds to climate and Improving the general investment
Malaysia has some of the most well- environmental projects provide useful tools environment as well as promoting
developed infrastructure among the newly for private investors looking to invest in more green finance will help to fund the
industrialized countries in Asia.5 It also green ventures. The first ever green sukuk infrastructure necessary to meet climate
targets. This means continuing to open up
to investors looking for green and ensuring
The post-COVID recovery: Building back better there is a pipeline of bankable, investment-
ready projects. These measures will ensure
The world is in the midst of a major crisis. could draw on green taxonomies such as that Malaysia is on the path to transitioning
In ASEAN, the global COVID-19 pandemic those developed in the EU, ASEAN, and by to a low carbon economy and becoming
has triggered economic recession that is the Climate Bonds Initiative, augmented more resilient to the impact of climate
impacting the lives of millions across the to include assets that explicitly enhance change and other global shocks.
region - with protective measures taken to resilience.
Green infrastructure has positive
prevent the virus’s transmission shutting
As part of improving economic resilience, environmental and economic benefits.
down large parts of the region’s economy.
the programmes should exclude activities It can create prosperity by increasing
Once this health crisis comes under which are at risk from future shocks. competitiveness, productivity and
control, governments will need to For instance, assets that could become employment opportunities; extending the
find ways to stimulate growth, to get stranded as a result of climate policy reach, reliability and efficiency of the national
economies moving again. All future changes, or those that are not resilient to electricity grid, without creating air pollution;
economic stimulus packages should aim climate physical risks. Investor confidence broadening the economic base; creating
to contribute to building a healthier, more can be built by using available taxonomies new markets; and providing inclusion and
resilient and more sustainable economy. with a high degree of international connectivity across Malaysia.
recognition.
This is a huge opportunity: to use green
finance, to fund COVID-19 recovery efforts Governments simply need to focus on
that also advance climate mitigation and investments that can be characterized as
adaptation goals. Project inclusion for ‘building back better’, and greener.
COVID-19 recovery bond programmes
Malaysia GIIO Report Climate Bonds Initiative 5
3. Malaysia context
Country facts
Population: 32 million (early-2020)10
Population growth rate: 1.3% (early-2020)11
Urban population: 78.4% (early-2020)12
GDP: USD364.681bn (2019)13
GDP growth rate: 4.3% (2019)14
Interest rate (cash rate): 1.75%
(as of Jan 2021)15
Inflation (consumer prices):
0.663% (2019)16
Net inflow FDI: USD7.5bn
(Q1, March, 2020)17 Rating
Government 10Y Yield: 2.662% (daily, 9 Jan, 2021)18 A-, stable (S&P)36
Balance of trade: USD5.1bn (as of Dec, 2020)19 A3, stable (Moody’s)37
Government debt to GDP: 61% (latest, Sept 2020)20 A-, stable (Fitch)38
Malaysia’s macroeconomic outlook
Green finance presents an Annual GDP growth and Inflation rate in Malaysia 2000-2019
opportunity in promising 10
macroeconomic conditions.
Inflation rate (annual %) GDP growth (annual %)
Over the past decade, Malaysia’s economy 8
has grown rapidly while remaining resilient,
but the pace of expansion has moderated. 6
In 2019, real GDP growth reached 4.5%
(y-o-y), 0.2% lower than 2018 growth. 4
Private consumption has remained the
largest contributor to output growth, 2
which is supported by stable labour market
Percentage
conditions, benign inflation and continued 0
growth in real income.21 The COVID-19
pandemic has meant that GDP is estimated -2
to have contracted by 4.5% in 2020.22
2000 2005 2010 2015 2019
Despite this, in its Economic Outlook 2021,
(Source: World Development Indicators, WB)
the Ministry of Finance states that it expects
a 6.5% -7.5% rebound in 2021.23
The ongoing fallout of the COVID-19 also be seen in manufacturing, construction,
Malaysia has a sound and resilient pandemic, together with the sudden mining, and agriculture27 while the negative
financial system with IMF financial enforcement of the Movement Control effects on credit markets and supply chains
soundness indicators24 showing that the Order (MCO), has put various sectors of will dissipate only gradually28. Consequently,
banking system is robust and orderly the economy under extreme stress. The Malaysia’s economy is estimated to have
underpinned by ample liquidity and strong Malaysian tourism industry has been hardest contracted 4.5%.29
capital buffers. The capital market is hit, facing an estimated loss of MYR3.37bn
The COVID response, alongside policies
also effective, driven by well-developed (USD811m) in the first two months of 2020
to control and reduce the health impacts,
infrastructure and instruments.25 alone.26 Indirect impacts of the virus can
includes several measures to overcome the
Malaysia GIIO Report Climate Bonds Initiative 6
economic downturn. In February 2020, an Fiscal Deficit in Malaysia 2012-2019 (percentage of GDP)
emergency stimulus package was announced
worth USD4.8bn, of which, about USD453m 0
is allocated to the tourism industry, aiming to
2012 2013 2014 2015 2016 2017 2018 2019
counter the immediate impact of the outbreak
-1
on vulnerable sectors and households.30 In
March 2020, the PRIHATIN Rakyat Economic
Stimulus Package valued at MYR250bn -2
(USD57bn), was announced, focusing on
supporting businesses, especially SMEs,
assisting low and middle-income households, -3
Percentage of GDP
and providing fiscal injections to strengthen -2.9
-3.1
the national economy.31 In June 2020, the -3.2
-3.4 -3.4
government unveiled a new short-term -4 -3.7
-3.8
economic recovery plan named “National
Economic Recovery Plan (Penjana)” worth -4.3
-5
MYR35bn (USD8.2bn).32,33 As part of the
recovery plan, the Government of Malaysia (Source: WB56,57)
launched ‘Sukuk Prihatin’ to raise finance for
the Kumpulan Wang COVID-19 to finance Immediate policy responses have softened industries. There is yet to be a discussion
measures announced in the economic the impact of the COVID-19 pandemic on on the possibility of longer-term green
stimulus packages and recovery plan to the Malaysian economy and paved the path stimulus to support renewable energy,
address the COVID-19 crisis34. The ‘Sukuk towards economic recovery.35 To date, the public transport or other types of green
Prihatin’ has been likened to a war-bond, in stimulus has primarily focused on short term infrastructure covered in this report.
that it carried patriotic elements. emergency funding for the most affected
Infrastructure spending
Infrastructure pipelines are Demand for energy and electricity, Water: 99% of the population should have
growing, with more opportunities according to the International Energy access to clean and treated water by 2020.
emerging for outside investment. Agency’s projections are expected to grow
Energy: 7,626 MW of new generation
by 2.2% and 4% per year respectively from
Malaysia has some of the most well-developed capacity should be installed in Peninsular
2013 to 2040.47,48 Moreover, the urban
infrastructure among the newly industrialized Malaysia by 2020.
population is growing at an annual rate
countries in Asia.39 The majority of Malaysians
of 2.1%49 adding pressure to the current This implies that more infrastructure projects
have access to essential facilities and services
infrastructure capacity. This will also in various forms will be developed and huge
such as public transport, communications,
challenge Malaysia’s ability to generate investment will be needed.
electricity and clean water, resulting from
enough energy from cleaner sources, which
heavy investment in infrastructure by the In 2019, approximately USD13bn was
it has committed to increasing to 31% in its
government over the past ten years.40 invested in infrastructure, accounting
generation mix by 2025 and 40% by 2035.50
Some headline developments include two new
With its mission of moving from an upper-
major national ports (Port Klang and the Port
middle-income economy to an advanced
of Tanjung Pelepas), which are categorized
economy, the Eleventh Malaysia Plan 2016-
in the world’s top 20 container ports;41 the
2020 has set up ambitious goals for each
growth of the national road network by 68%
sector as follows:
between 2010 and 2015;42 and the expansion
of seven international airports across the Transport: Public transport modal coverage
country. Each of these developments has should be 40% in urban areas by 2030.
helped to position Malaysia as the preferred
Logistics: The transport and storage
transfer and logistics gateway to Asia (after
subsector should grow at 8.5% annually by
Singapore) for passengers and cargo.
2020 and be in the top 10 of the World Bank
Despite this, locational disparities and Logistic Performance Index.
political differences across regions pose
several problems for infrastructure
development43 particularly in reaching
consensus on infrastructure policy, leaving
the uneven infrastructure development
across the country.44 For example, the
transportation network in East Malaysia
is less advanced compared to that in
Peninsular Malaysia.45,46
Malaysia GIIO Report Climate Bonds Initiative 7
for 3.66% of Malaysia’s GDP, while the Infrastructure investment at current trend and need in Malaysia
required investment would have been about
USD15bn.51 If the current investment growth 30
rate continues, business-as-usual investment
should meet up to 82% of the infrastructure Current trends Investment need
development requirements up to 2040. 20
Among the different sectors, energy and
road transport will be the two highest
capital-incentive areas during the period of 10
USD Billions
2007-2040.
There is a need for greater private and
0
foreign investment. Various forms of
funding and initiatives have been applied 2005 2010 2015 2020 2025 2030 2035 2040
to attract investment into infrastructure
Source: The Global Infrastructure Outlook, 2020
projects.52 Traditionally, public budgets have
been used to finance most infrastructure
projects.53 However, government spending Infrastructure investment at current trend for each sector in Malaysia
is constrained by a 55% public debt to GDP
10
ratio, and therefore other sources of funding
have been promoted, such as foreign Energy Transport: Road
investment or private investment PPPs.54 Telecommunication Water
Malaysia has used PPPs to finance many Transport: Ports Airport
of its infrastructure projects since 1983 5 Transport: Rail
and will continue to adopt new PPP
funding models. The major challenge of
USD Billions
new PPP projects is the ability of users to
pay for them. The presence of Chinese
investment in Malaysia’s infrastructure, 0
through soft loans by Chinese government 2005 2010 2015 2020 2025 2030 2035 2040
agencies or contractor-financing, is also a Source: The Global Infrastructure Outlook, 2020
notable feature.55
Malaysia’s climate policy
Climate change has already had Policy - on energy pricing, strategic supply The Renewable Energy Act came into effect
significant adverse impacts on developments, end use energy efficiency, in 2011, and a feed-in-tariff (FiT) mechanism
Malaysia, including increased energy governance and regulation as well as was introduced, benefiting renewable energy
temperatures and rainfall, sea management of change and affordability.63 developers and expediting growth in the
level rise, and other extreme The eleventh Malaysia Plan 2016-202064 renewable energy sector.66
weather events.58 further indicated green growth as one of the
National Policy on the Environment (NPE)67
strategic thrusts enabling Malaysia to stay
Malaysia’s key strategy to mitigate was launched in 2002 in recognition of the
ahead of environmental challenges and build
greenhouse gas emissions is in the energy, importance of integrating environmental issues
a sustainably developed economy.
waste and forestry sector. Mitigation in the into the overall framework of development.
other sectors such as industrial processes The twelfth Malaysia Plan will run from 2021- The policy seeks to promote economic, social
and product used (IPPU) and Agriculture 2025 and while there has been a delay in its and cultural development in harmony with
have yet to be quantified. release, Environmental Sustainability will be environmental protection and enhancement.
a key pillar with a focus on climate mitigation
The Malaysia Plans have been central to In 2009, the National Policy on Climate
and adaptation as well as green technology,
climate response starting with the Eighth Change68 was introduced in an effort
sustainable production and consumption.65
Malaysia Plan (2001 – 2005)59 which to develop specific national policies for
introduced the Five Fuel Diversification In addition to the Malaysia Plans, other key strategies on climate change in Malaysia and
Policy where renewable energy was first policy developments have included: respond to the United Nations Framework
promoted as a source of energy, although Convention on Climate Change (UNFCCC).
The National Renewable Energy Policy and
hydropower was already used.60 In the In this policy, the Malaysian Government
Action Plan (2010) set out the vision of
Ninth Malaysia Plan (2006 – 2010)61 energy emphasizes sustainable development and
enhancing renewable energy resources to
efficiency was also included. The Tenth the conservation of the environment and
contribute towards national energy supply
Malaysia Plan (2011-2015)62 set further natural resources, ensuring that climate-
security and sustainable socio-economic
goals for renewable energy development resilient development fulfils national
development.
in Malaysia, introducing the New Energy aspirations for sustainability.
Malaysia GIIO Report Climate Bonds Initiative 8
The National Green Technology Policy69 Sustainable Finance policies
was also introduced in 2009 to accelerate
2011- Capital Market Masterplan 2 (CMP2)
the national economy and promote
2020 Securities Commission Malaysia
sustainable development. The policy has
five main strategic thrusts to encourage To create an advantageous environment to amplify the role of the private
green technology application and expansion sector and the financing of entrepreneurial economic activities that are crucial
to most sectors, in which four primary to the future of the Malaysian economy.
pillars are renewable energy, environment,
CMP2 outlines key strategies to foster a more innovative intermediation environment
economy and social perspective.70
through the growth and governance of Malaysia’s capital markets. It positions the
The Green Investment Tax Allowances capital markets to play a critical role in financing sustainable development needs.
(GITA) and Green Income Tax Exemption
Sustainable and Responsible Investment (SRI) Sukuk Framework
(GITE) are two incentive schemes that 2014 Securities Commission Malaysia
were introduced in 2014 to strengthen
the development of green technology. SRI Sukuk Framework features guidelines and standards on issuances of
Companies that acquire green technology green, social and sustainable sukuk to facilitate an ecosystem that promotes
assets, undertake green technology projects sustainable and responsible investing for SRI investors and issuers.
and green technology service providers are
As of November 2020, 17 SRI Sukuk have been issued in Malaysia amounting
eligible to apply for the incentives. Several
to MYR5.38bn
GHG mitigation related projects and services
have been approved under both GITA and Sustainability Reporting
GITE, most of which are renewable energy 2016 Bursa Malaysia
and energy efficiency projects.
All companies listed on Bursa Malaysia under the main market and ACE
The evolution of these national policies market are required to issue a Sustainability Statement in respect of the
shows the commitment from the company’s management of economic, environmental and social risks and
government towards a successful transition opportunities in their annual report.
to a more sustainable and low carbon
A Sustainability Reporting Guide has also been published by Bursa Malaysia to
economy.
assist the companies in preparation of their report.
Value-Based Intermediation (VBI)
“Malaysian intermediaries, over the 2017 Bank Negara Malaysia
years, have been developing Shariah-
compliant financial solutions that VBI serves as an intermediation function for Islamic banking institutions with
provide investors the choice of climate- the purpose of delivering positive and sustainable impact to the economy,
friendly investments that allow them community and environment through the intended outcomes of Shariah
to participate in initiatives to green the practices, conduct and offerings, while being consistent with the shareholders’
economy and combat climate change. returns and long-term interests.
The Securities Commission Malaysia is
Islamic banks are required to premise their intent, strategy and performance on
committed to facilitate and enable the
the underlying thrust of VBI which include best conduct, good self-governance,
collective efforts of market participants
entrepreneurial mindset and community empowerment.
who are investing in a low carbon
future and will continuously strive Islamic Fund and Wealth Management Blueprint (IFWMB)
to enhance our policy framework for 2017 Securities Commission Malaysia
sustainable finance.”
The IFWMB is a 5-year blueprint to plan the medium and long-term strategic
Syed Zaid Albar, Chairman, Securities direction for Malaysia’s Islamic fund and wealth management industry.
Commission Malaysia
With a vision of establishing Malaysia as a leading international centre for
Islamic fund and wealth management, the key thrusts are (1) to strengthen
Malaysia’s positioning as a global hub for Islamic funds, (2) establish Malaysia
as a regional centre for shariah-compliant sustainable and responsible
investment and (3) develop Malaysia as an international provider of Islamic
Malaysia’s climate goals wealth management services
As part of its NDCs under the Paris
Agreement, Malaysia has defined the
2019- Sustainable and Responsible Investment (SRI Roadmap)
following mitigation targets/ GHG
2025 Securities Commission Malaysia
reduction targets: To create a facilitative SRI ecosystem and map the role of the capital markets in
driving Malaysia’s sustainable development
• 35% reduction by 2030, compared
to the business-as-usual scenario of 5 Key focus areas include:
2001-2030
• Widening the range of SRI instruments
• 45% reduction by 2030, with the • Increasing SRI investor base
receipt of climate finance, technology • Building a strong SRI issuer base
transfer and capacity building from • Instilling strong internal governance culture
developed countries. • Designing information architecture in the SRI ecosystem
Malaysia GIIO Report Climate Bonds Initiative 9
4. Malaysia green finance trends and opportunities
Global demand for green investments Global green bond and sukuk issuance 2015-2020
is growing with strong momentum
1.0
and significant growth potential. Green
labelled products have become globally
recognised as an effective means of directing Cumulative issuance
0.8
investment capital towards climate change
mitigation and climate change resilience Yearly issuance
and adaptation projects, including green
0.6
infrastructure. The growing level of interest
from investors in green projects has resulted
Amount issued (USDtn)
in the development and growth of innovative 0.4
financial products including green, social and
sustainability bonds and loans; and green
index products. 0.2
Green bonds are currently the most developed
segment of thematic instruments, carrying
greater recognition from the investor base. 0
Globally, the volume of green bond and loan 2015 2016 2017 2018 2019 2020
issuance has risen sharply from USD171bn © Climate Bonds Initiative 2021
in 2018 to USD269.5bn in 2020, buoyed
by strong interest from both investors and ASEAN green bond and sukuk issuance is growing
issuers.71 Cumulative issuance of green bonds
to date has now reached USD1tn, but there 800
is still a long way to go. To finance the goals
Indonesia Philippines Thailand
of the Paris Agreement, it is estimated that
green bond issuance needs to reach USD1tn Malaysia Singapore Vietnam
per annum by the early 2020s. For emerging 600
markets in particular, there is a large gap
between green infrastructure requirements and
the size of green bond markets.
400
Both Malaysia and the ASEAN region mirror
the upward trend where, supported by new
regulation, ASEAN issuance has grown both
within Malaysia and across the region. 200
USD Billions
ASEAN is increasingly appealing to investors
with several foreign entities, including
development banks as well as foreign
0
commercial banks, issuing green bonds
denominated in local ASEAN currencies 2016 2017 2018 2019 2020
demonstrating interest in these domestic
markets. Other green bond issuers such
as BNP Paribas, Société Générale, Bank of ASEAN Green Bond Standards
America and NAB have issued vanilla bonds
One of the key drivers of regional growth report, must be made publicly available
in at least one of the local ASEAN currencies.
is the ASEAN Green Bond Standards. The on a designated website;
Issuance in local currency allows foreign
ASEAN Green Bond Standards are based
issuers to tap domestic investors for capital. • Recommendation to obtain an external
on the ICMA Green Bond Principles and
Interest in ASEAN markets continues to grow. review for the green bond framework,
seek to enhance transparency, consistency
and is particularly recommended for
and uniformity to help reduce issuance
the management of proceeds and
and investment costs. Key elements of the
annual reports; and
“In recent years there has been standards include:
significantly more engagement from • Recommendation for the external
• The issuer or issuance of the green bond
institutional investors for integrating review providers to disclose their
must have a geographical or economic
ESG in their investment process [in relevant credentials and expertise and
connection to the region;
ASEAN] and the wealth management the scope of the review conducted.
industry is now following.” • Fossil fuel power generation projects are
For more information on the ASEAN
explicitly excluded;
Valentin Laiseca, MSCI’s Head of ASEAN green bond market, please see the
Index Sales72 • Information on the process for project Climate Bonds’ report: ASEAN Green
selection and on the use of proceeds Finance State of the Market 2019.
allocation, as well as the external review
Malaysia GIIO Report Climate Bonds Initiative 10“As ASEAN grows and steadily fulfils Climate Bonds Green Bond European Investor Survey shows
its economic potential, opportunities interest in investment in emerging markets
exist across a wide range of industries.
For example, ASEAN has over USD2tn Outstanding emerging markets (EM)
worth of infrastructure investment green bonds, as of end 2020, amounted
opportunities – not just traditional ports, to over USD204bn, or around 20% of
roads, and bridges, but support in ICT, the green bond market. Meanwhile, EMs
education, agriculture, and healthcare.” currently account for 63% of global GHG
emissions.76 It is thus critical to determine
Alexander Feldman, President & CEO,
how investors can support the expansion
US-ASEAN Business Council73
of EM green bonds.
Respondents of CBI’s Green Bond European
Investor Survey were asked to describe
“We have some very long-term horizons. their appetite for EM green bonds and
If you’re a long-term investor, you can to outline what they could be receptive
focus on specific areas, like Southeast to buying. Most respondents (82%) can
Asia funds... [where] there is a source of buy EM debt. Exposure limits at country
growth.” and issuer level tended to apply more to
respondents that have a greater degree
Ted Lee, Senior Portfolio Manager of
of integration of green bonds. However,
Canadian Pension Plan Investment Board74
the most common restrictions are credit
rating (69%), currency (65%) and deal
market. Credit enhancements available
size (58%).
from multilaterals and/or public sector
“European industry still overwhelmingly As most respondents can and would like entities was the most frequently selected
sees ASEAN as an attractive region for to buy EM green bonds, EM issuers must option, with more than half considering it
growth and investment, as our 2017 consider how these requirements can be important or very important.
Business Sentiment Survey showed. But reconciled. Respondents expressed that
When respondents were then asked which
that survey also showed a strong call for they would like to increase their holdings
features would give them more confidence
more progress on government initiatives in EM sovereigns. Countries such as
to invest in EM green bonds, they listed
to reach trade agreements, reduce Indonesia (3 bonds in USD), Seychelles
the following:
barriers to trade, and realise the vision of (USD) and Lithuania (EUR) have issued
the ASEAN Economic Community.” green bonds that were met with a positive 1. Transparency: e.g. adherence to GBP,
reception from investors. reporting Use of Proceeds (65%),
Donald Kanak, Chairman, EU-ASEAN
Business Council75 Three-quarters of respondents able to 2. Reliability: e.g. external reviews (SPO,
buy EM green bonds treat EMs differently audit, certification, etc) (48%),
from developed markets, stating that they
3. Risk: e.g. insurance/CDS/guarantees,
require more evidence of integrity to invest
size of issuance, currency (25%).
in green bonds from EMs. So, respondents
were also asked to rank factors that More information on this topic can be
could make investing in EM green bonds found in the Green Bond European Investor
more attractive and bring scale to the Survey, on the CBI website.
Malaysia GIIO Report Climate Bonds Initiative 11Malaysia’s green bond and sukuk market
Market overview Malaysian green bond and sukuk Finally, PNB Merdeka Ventures became
Malaysia is already a leader in green finance.
market analysis Malaysia’s first repeat issuer with a total of 3
deals issued in 2017 and 2019 amounting to
There have already been several landmark A total of 14 green bond and sukuk deals
USD382m. They are part of its programme
deals out of Malaysia, including the world’s have been issued by Malaysian entities80
to finance the Merdeka PNB118 Tower.
first green sukuk, issued June 2017, by Tadau with six occurring in 2019 and two in 2020.
Energy Sdn Bhd. There has been only one repeat issuer to Among outstanding bonds, energy (49%)
date - Permodalan Nasional Berhad has and buildings (48%) represent almost
The Securities Commission Malaysia (SC)
come to market three times. all the allocations. The remaining 3% are
led the way by issuing its Sustainable
spread across Water, Waste, Land use and
and Responsible Investment (SRI) A green sukuk was issued by Pasukhas
Adaptation funded predominantly by the
Sukuk Framework in 2014 which features Group Bhd for MYR17m (USD3.9m) (out
Pasukhas deal. The largest issuer in the
guidelines and standards on issuances of a facility size of MYR200m) with a
buildings sector is Permodalan Nasional
of green, social and sustainable sukuk, 20-year term, with proceeds allocated to a
Berhad (PNB Merdeka Ventures), while the
followed by the SRI Roadmap for the hydropower plant. The sukuk is guaranteed
largest related to energy is Quantum Solar
Malaysian Capital Market77,78, which by Danajamin Nasional, the financial
Park (Semenanjung Sdn Bhd).
introduced a strategy for developing the guarantor co-owned by Bank Negara
market for SRI investments. Malaysia and the Ministry of Finance. An All green bond and sukuk deals have been
SPO and green rating were provided by RAM. issued in domestic currency, ranging in
In 2018, Malaysia showed global leadership
USD-equivalent size from about USD50m
by establishing the Green SRI Sukuk Grant Another 2019 issuer was Telekosang Hydro
to USD500m, and tending towards
Scheme – one of the first global examples One Sdn Bhd with a MYR120m (USD42m)
longer terms. This demonstrates that the
of incentive structures to support green 20-year green junior bond and a MYR470m
Malaysian bond market is sufficiently
bond issuance. It provides tax exemption (USD166m) 18-year green sukuk, both
mature to support the development of
benefits for green sukuk issuers. In January allocated to a 24MW “run-of-river mini-
a local green bond market. It is also a
2021, this Grant Scheme was renamed hydro” plant, the first of its kind. RAM also
potential hub for green Islamic transactions,
the SRI Sukuk and Bond Grant Scheme provided a green rating of Telekosang’s
with 75% of outstanding green bonds
and made applicable to all sukuk issued Green Sukuk Framework.
offered in sukuk format.
under the SC’s Sustainable and Responsible
Two new deals came to market in
Investment (SRI) Sukuk Framework or bonds
October 2019. Edra Solar Sdn Bhd issued
issued under the ASEAN Green, Social and
an 8-tranche MYR245m (USD58m) “Malaysia has earned the recognition
Sustainability Bond Standards (ASEAN
Sustainability SRI sukuk, with maturities as the pioneer in driving the Green SRI
Standards). The Securities Commission
ranging from one to 18 years. While it will Sukuk agenda since 2014. The Green
and Bank Negara Malaysia, in the newly-
primarily refinance the Kuala Ketil solar SRI Sukuk stands out because of its
formed Joint Committee on Climate Change
farm, part of the proceeds will fund the strength in investor engagement which
(JC3), are discussing the development of
cultivation of pineapples and other crops requires the issuers to conduct robust
a taxonomy for Malaysia. In a Discussion
by the surrounding local community. and responsible reporting. We felt it
Paper,79 Bank Negara Malaysia launched a
Given its social angle, this is the country’s was inevitable for Telekosang Hydro to
public consultation on the impact of climate
first bond aligned with the requirements make use of this platform, not only as
change on the financial system. By requiring
of the Securities Commission Malaysia’s promoters of sustainable developments
financial institutions to report data on their
Sustainable and Responsible Investments for future generations, but also to
climate exposure, this new taxonomy will
(SRI) Sukuk Framework, the ASEAN Green attract international investors that
support the issuance of green bonds and
Bond Standards, the ASEAN Social Bond embrace sustainability. As Malaysians,
the purchase of green bonds issued in the
Standards and the globally recognised GBP, we are proud that Telekosang Hydro has
Malaysian market by financial institutions.
SBP and Sustainability Bond Guidelines. It is been given the highest recognition as
So far Malaysia has been exploring also the first to carry three different types of the World’s First Green SRI Sukuk for
green debt as well as equity instruments, rating from RAM: financial, green (Tier-1 GB) Mini Hydro.”
supported by credit enhancement and social (Tier-3 SB).
Beroz Nikmal bin Mirdin, CEO of
mechanisms and other risk-sharing
Cypark Red Sdn Bhd issued MYR550m Telekosang Hydro One Sdn Bhd
approaches. This includes green bonds,
(USD131m) under an SRI Sukuk Murabahah
green sukuk, green loans, green funds for
programme, also in October. The deal,
green infrastructure and renewable energy
which has 19 tranches with terms varying
projects, and credit guarantees for green
between three and 21 years, will finance
projects. Green bonds and green sukuk
three solar PV plants (with 30- MWAC
remain the most dominant of these green
capacity) in Malaysia.
instruments and tools.
Malaysia GIIO Report Climate Bonds Initiative 12Malaysian green bond and sukuk issuance
Issuer name Bond/Sukuk Amount issued* Issue date Issuer type Use of proceeds
Solar Management Sukuk MYR260m Sept-20 Non-financial Energy
(Seremban) Sdn Bhd (USD64.4m) corporate
Leader Energy Sdn Bhd Sukuk MYR260m Jul-20 Non-financial Energy
(USD61m) corporate
PNB Merdeka Ventures Sukuk MYR435m Dec-19 Government- Buildings
Sdn Bhd (USD105m) backed entity
Cypark Ref Sdn Bhd Sukuk MYR550m Oct-19 Non-financial Energy
(USD131m) corporate
Edra Solar Sdn Bhd Sukuk MYR245m Oct-19 Non-financial Energy, Land use
(USD58m) corporate
Telekosang Hydro One Sdn Bond and Sukuk MYR590m Aug-19 Non-financial Energy
Bhd (USD208m) corporate
PNB Merdeka Ventures Sdn Sukuk MYR445m Jun-19 Government- Buildings
Bhd (USD108m) backed entity
Pasukhas Green Assets Sdn Sukuk Issue size: Feb-19 Non-financial Energy, Buildings,
Bhd MYR17m corporate Water, Waste, Land
(USD3.9m) use, Unallocated
A&R
Facility size:
MYR200m
UiTM Solar Power Sdn Bhd Sukuk MYR222m Apr-18 Government- Energy
(USD57m) backed entity
Sinar Kamiri (Mudajaya Sukuk MYR245m Jan-18 Financial corporate Energy
Group Berhad ) (USD63m)
SEGI Astana Sdn Bhd Bond MYR415m Jan-18 Non-financial Buildings
(USD104m) corporate
PNB Merdeka Ventures Sdn Sukuk MYR690m Dec-17 Government- Buildings
Bhd (USD170m) backed entity
Quantum Solar Park Sukuk MYR1,000m Oct-17 Non-financial Energy
(Semenanjung) Sdn Bhd (USD236m) corporate
Tadau Energy Sdn Bhd Sukuk MYR250m Jul-17 Non-financial Energy
(USD58m) corporate
(Source: CBI database), *Note currency conversion rates are taken on date of issue
Malaysian social and sustainability bonds
Issuer Amount* Issuer date Type, UoP
Khazanah Nasional Berhad MYR 100m (April 2015) Social, education
(USD 28m)
HSBC Amanah Malaysia MYR500m (October 2018) Sustainability
(USD121m)
CIMB Bank Berhad USD680m (October 2019) Sustainability
Edra Solar Sdn Bhd MYR30m (October 2019) Sustainability
(USD7m)
Government of Malaysia, Sukuk Up to MYR500m September 2020 Social, COVID
Prihatin (USD124.3m) response
Cagamas (National Mortgage MYR100m October 2020 Social, Affordable
Corporation of Malaysia) (USD24.8m) housing81
(Source: CBI database)
Malaysia GIIO Report Climate Bonds Initiative 13Green Technology Financing GTFS performance by sector, 2010-2020
Scheme (GFTS) and Financial
Institutions’ participation 500
The Green Technology Financing Scheme 400 491
(GTFS) was initially launched in 2010
by the Government with a total target 300
Approved projects
financing approval of MYR3.5bn to support 2014
the development of green technology in 200
Malaysia.82 In March 2019, the Ministry of 127
100
Finance approved an extension of GTFS,
known as GTFS 2.0 with an allocation 21 16
0
of MYR2bn until 2020.83 The scheme
aimed to promote green investments in Energy Waste & Building Transportation
water (Source: Green Tech Malaysia96)
eligible sectors such as energy, water,
building and township, transport, waste
and manufacturing by providing easier GTFS Projects financed
access to financing and at lower financing
costs.84 GTFS provides green investors 30 UOB Bank
with a 2% rebate on interest/profit rate
23 SMe Bank
charged by financial institutions and a
7 Standard Chartered
60% Government Guarantee on financing
provided by financial institutions.85 Credit 7 RHB Islamic
Guarantee Corporation Malaysia Berhad 7 RHB Bank
(CGC) also provides a guarantee of 60% 7 Public Bank
on the approved financing amount. Upon 1 Others
guarantee approval, CGC will issue a Letter 2 OCBCAI-Amin
of Guarantee (LG). A guarantee fee of 0.5% 30 OCBC
per annum on the total guarantee amount
45 MDV
will be charged to the borrower.86
12 Maybank Islamic
Since its introduction, GTFS has benefited 25 Maybank Berhad
a number of green projects. In 2010,
3 Kuwait FH
only 13 projects were granted soft loans
11 HSBC Amanah
amounting to MYR164.3m87 By 2017,
6 HSBC Bank
these figures had risen to 319 projects
and MYR3.638bn to be allocated with 8 Hong Leong Bank
significant social and environmental 1 Exim Bank
impacts.88 About 5,000 green jobs were 3 CIMB Islamic
created and 3,784 million tons of CO2 5 CIMB Bank
has been saved each year.89 The GTFS 2 Bank Islam
2.0 has granted soft loans to additional 2 Bank Rakyat
336 green technology producers and
12 Bank Pembangunan
users with MYR1m to be drawn down.90
4 Amislamic Bank Berhad
The latest version, GTFS 3.0 has a fund
size of MYR2bn (USD500m) for 2 years 10 ArriBank
until 2022 with a guarantee by Danjamin 2 Agro Bank
Nasional to encourage issuances of SRI 7 Affin Bank
sukuk. It is expected to generate MYR4bn 7 Affin Islamic Bank
in revenue from green investments and 3 Alliance Bank
create 2,500 job opportunities for the
country.91,92 0 10 20 30 40 50
Approved projects
The GTFS has resulted in the participation (Source: Green Tech Malaysia97)
of 28 banks and financial institutions with
approximately USD875m in loans as of July
the full methodology for project selection is be eligible but require that the feedstock
2018.93 Of all projects financed, about 53%
not available and while it appears broadly is sourced sustainably and that it has an
came from conventional finance, with the
aligned with the Climate Bonds Taxonomy 80% emission reduction compared to a
rest funded by Islamic sources.94
and Climate Bonds Standard, there may be fossil fuel baseline95. Biofuels are included
The GTFS is a unique example of how some areas where they are not in alignment. under the GTFS but a full assessment of the
governments can support the growth of Within energy, for example, biofuels alignment between GTFS criteria and the
green projects using tools like guarantees remain contentious. Under the Climate Climate Bonds sector criteria has not yet
and incentives. We note here, however, that Bonds Bioenergy sector criteria, they may been undertaken.
Malaysia GIIO Report Climate Bonds Initiative 14Financing credible transitions in Malaysia
EN T: ZERO
The Climate Bonds Initiative has been
active in promoting the creation of credible
E M
E
transition strategies in GHG-emissions
intensive industries around the world. The
R EV E LOPM C
D LIM E
concept of transition reflects the fact that, in
2 STA I N AB AG
the short- to medium-term, large companies
A R G OA L S
in many sectors will inevitably straddle
C AT
NT
LE
both brown and green assets, progressively
BO
PARIS
reducing exposure to brown assets and
EA
practices as they increase capex towards,
N BY 2050
and adoption of, greener modes of operation.
It also embodies a recognition that, both
CTI ON
globally and locally, the expectation of
institutional investors is that progress
towards low or zero-carbon business models,
is increasingly indicative of sound corporate
performance, hedging of climate risks and
0
long-term value accretion.
SU
3
Global green investment opportunities
0
are growing and yet large GHG emitters
,
are still largely absent from the market.
5
GHG-intensive segments of the real Y 0%
economy - such as cement and concrete,
S B EM I SS I O N
mining and metals, oil and gas transport and
manufacturing – offer significant emissions
reductions potential –but are not yet
following a transition pathway towards zero
carbon by 2050. When such industry sectors
start to align with a 1.5-degree emissions
trajectory, new green financing opportunities Fossil fuel consumption in Malaysia
could be created for assets and projects with
100
ambitious climate targets and an increased
focus on low carbon production modes.
A credible transition strategy requires 80
organisations to commit to strategic change,
undertaking tangible and verifiably climate
60
relevant measures that relate to companies’
core business activities. They will need more
than broad statements of strategy or intent 40
to disclosure climate risk as envisioned by
compliance with the Task Force on Climate- Fossil fuel energy Electricity production from oil,
related Financial Disclosures (TCFD). 20 consumption (% of total) gas and coal sources (% of total)
Percentage
They will need a visible reflection of green
investment on balance sheets, in capex plans
0
and borrowing programs.
1972 1978 1984 1990 1996 2002 2008 2014
Transition bonds are a highly visible means
(Source: World Development Indicators)
to support this transition from brown to
green. Even a small initial share of green Malaysia’s economic growth is connected large share of energy supply comes from
capital expenditure could be a credible with the availability and supply of fossil fuel these sources.100 Specifically, in Malaysia,
indicator of more to come, if it is combined resources.98 Fossil fuel energy consumption more than 80% of electricity production is
with a re-orientation and acknowledgment to (% of total) in Malaysia increased from generated from oil, gas and coal.
investors that achieving low carbon targets about 75% in 1972 to a peak of 96.63%
The dependence on fossil fuel is believed
and then zero-carbon operating models are in 2014. This is because industrial and
to put Malaysia under the threat of energy
inevitable business destinations between transportation sectors in Malaysia have
insecurity and environmental degradation
now and 2050, backed up by green spending remained heavily dependent on oil and
due to the short life expectancy of Malaysia’s
and capex plans. Transitioning to a green, natural gas.99 In addition, as a result of
fossil fuel reserves and high CO2 emissions.
climate resilient economy is paramount to rapid industrialization and urbanization,
Thus, the Malaysian government has taken
ensure that the region can reduce its GHG the demand for energy is on the rise, which
steps to decrease the reliance on fossil fuels
emissions, better hedge against climate contributes to increasing consumption
and green the economy.
change risks and thrive in the long-run. and exploitation of fossil fuels since a
Malaysia GIIO Report Climate Bonds Initiative 15Malaysia’s policy framework has evolved
from a sole focus on fossil fuel supply in the
Examples of Malaysia’s policy instruments on green economy
1970s to a diversification of supply sources,
Year Policy instrument Functions of policy instruments
including renewable energy, since 2001.101
Central to Malaysia’s transition strategy 2009 National Green The policy emphasizes the central role of green
are policies to foster green technology Technology Policy104 technology in Malaysia’s green development,
development in the country. In 2009, the overseeing greening in four sectors, including
country announced its newly developed energy, buildings, water and waste management
policy framework called the New Economic and transportation.
Model (NEM) with three-pronged goals,
2009 Green Building The index helps to enable green grading and
including inclusiveness, high income and
Index105 certification of Malaysian buildings.
sustainability.102 Green Technology is
earmarked as an important driver for the 2010 National Renewable The policy aims to enhance the utilisation of
twin goals of high income and sustainability. Energy Policy and indigenous renewable energy resources to
Later, the National Transport Policy 2019- Action Plan106 contribute towards national electricity supply
2030 also accelerates the implementation of security and sustainable socio-economic
low carbon mobility incentives by prioritizing development
public transport development and adopting
2010 Green Technology The scheme was launched to create a policy
green technology and cleaner fuels such as
Financing Scheme107 environment that would attract innovators and
biodiesel and electricity vehicles (EVs).103
users of green technology
2011 Renewable Energy The Feed-in Tariff is being implemented for biogas,
Act108 biomass, mini hydro, solar PV and geothermal
“Maybank Investment Bank plays an
2011 Low Carbon Cities The framework looks at addressing carbon
important intermediary role in bridging
Framework (LCCF)109 emissions in 4 main areas: urban environment,
the financing gap between issuers and
urban infrastructure, urban transportation and
investors, in line with our aspiration to
buildings
build a more sustainable and inclusive
ASEAN. 2013 Minimum Energy The standards specify the minimum level of
Performance energy performance that appliances, lighting and
Recently, we are seeing significant 2019
Standards (MEPS)110 electrical equipment (products) must meet or
interest and greater level of
exceed before they can be offered for sale or used
awareness from investors and relevant
for commercial purposes
stakeholders on matters relating to
ESG.” National Transport The policy has set forth targets and strategies
Policy 2019-2030111 for enhancing the country’s economic
Fad’l Mohamed, CEO of Maybank
competitiveness, while reducing negative impact
Investment Bank Bhd
of the transport sector on the environment
(Source: Adopted from Hezri and Ghazali (2011) and authors’ compilation)
Malaysia GIIO Report Climate Bonds Initiative 16You can also read
