From Policy to Projects: AIIB-UNDP Pact Seeks Faster Financing for Greener Growth

UNDP Administrator Alexander De Croo highlighted the difficulties many countries face when trying to convert development priorities into projects that investors are prepared to finance.

The Asian Infrastructure Investment Bank (AIIB) and the United Nations Development Programme (UNDP) have renewed their partnership to help countries develop sustainable infrastructure and climate projects that can attract investment and move into implementation. The two organisations have signed a new Memorandum of Understanding (MoU) focused on connecting national development priorities with financing opportunities, particularly in countries facing difficulties securing funding for major infrastructure projects. The five-year agreement is expected to strengthen cooperation between governments, development institutions and investors, helping turn important development plans into practical projects that improve people's lives.

Many countries have identified infrastructure improvements, climate protection and sustainable economic development as important priorities, but securing sufficient financing and preparing projects that meet investors' requirements remain major challenges. The renewed partnership will help governments develop investment-ready projects, access different sources of funding and coordinate financial resources to support national development programmes. By combining technical assistance with infrastructure financing expertise, AIIB and UNDP intend to support projects that strengthen economic resilience, improve essential services and create employment opportunities.

The agreement builds on a partnership established in 2023, which produced the Global Financing Playbook, a framework designed to help governments organise and combine development financing for national priorities. The framework provides guidance on how countries can bring together different funding sources and prepare projects that are suitable for investment. The renewed cooperation places greater emphasis on preparing sustainable infrastructure projects, mobilising large-scale financing in priority countries and helping investments progress from planning to actual implementation.

Turning National Development Plans Into Investment-Ready Projects

The partnership will combine UNDP's technical knowledge, country-level presence and government relationships with AIIB's experience in infrastructure investment and financial instruments. UNDP will help countries improve policies, prepare investment proposals and strengthen their ability to implement development projects, drawing on its experience working with governments and local communities. AIIB will contribute its infrastructure financing expertise to help identify viable projects, develop financial solutions and connect investment opportunities with potential funding sources.

UNDP Administrator Alexander De Croo highlighted the difficulties many countries face when trying to convert development priorities into projects that investors are prepared to finance. He explained that governments often understand their infrastructure and development needs but require stronger technical preparation and better connections with financing institutions to move their plans forward. The partnership is expected to help address these challenges by bringing together UNDP's practical experience in countries and AIIB's financial capabilities to support improvements in communities.

Climate Investment and Blended Financing to Support Sustainable Growth

The renewed agreement will cover sustainable infrastructure, project preparation, blended finance, climate and nature-related investments, policy support and coordination with governments at the country level. A major focus will be mobilising grants and concessional financial resources that can help attract additional funding from AIIB and other development partners. Combining public, concessional and private financing could make large infrastructure projects more financially viable, particularly in countries where limited resources or investment risks make it difficult to secure funding.

Zou Jiayi, President and Chair of AIIB's Board of Directors, emphasised that successful infrastructure investments depend on well-prepared projects that respond to countries' development needs. She highlighted the importance of combining the strengths of both organisations to create innovative financing arrangements and support infrastructure that contributes to greener economies, stronger resilience and improved connectivity among AIIB members. The cooperation will also support climate adaptation, environmental sustainability and investments that help countries strengthen their capacity to manage future economic and environmental challenges.

Five-Year Action Plan to Mobilise Investment and Create Economic Opportunities

A joint action matrix will guide the organisations' cooperation throughout the five-year agreement, providing a framework for identifying investment opportunities, preparing projects and coordinating financial resources. AIIB and UNDP will work with governments and development partners to develop project proposals and explore financing arrangements, with individual investments remaining subject to the respective organisations' approval processes. This coordinated approach is expected to strengthen project preparation and help countries overcome difficulties that prevent important infrastructure investments from reaching implementation.

The agreement also creates opportunities to connect AIIB's financing instruments with UNDP's newly launched Investment Accelerator, which supports governments in developing stronger investment policies and preparing portfolios of projects that are ready to attract financing. Through this initiative, countries can receive assistance in identifying investment opportunities, engaging potential investors and improving the processes needed to move projects from preparation into implementation. Stronger project development and investor engagement could help governments attract additional capital for sustainable infrastructure, climate resilience and economic development.

Employment creation, inclusive economic growth and improvements in local livelihoods will remain important considerations in the partnership's investment activities, reflecting UNDP's experience in community development and poverty reduction. The organisations will focus on ensuring that infrastructure investments contribute to better public services, stronger local economies and practical benefits for communities rather than concentrating only on the financial aspects of projects. Through their renewed five-year cooperation, AIIB and UNDP are seeking to help countries secure financing for sustainable development priorities and deliver infrastructure investments that support economic opportunities and long-term resilience.