The China-based multilateral bank could refinance its brownfield infrastructure projects in the capital markets, giving institutional investors infrastructure-linked assets to invest into.
Financial services firms and governments should work to create more products providing exposure to infrastructure, an AsianInvestor forum heard. Australia is held up as a good model.
Risk-averse by nature, institutional investors need credit enhancements and minimum guarantees if they are to invest more in Asian infrastructure.
The Asian Development Bank does not see a bubble forming in the Asian local-currency bond markets, but Allianz Global Investors believes otherwise.
The Asian Development Bank warns that the region must improve bond market liquidity and cooperation or bond prices will suffer.
ADB economist Jayant Menon says the region should weather a Western economic storm, but its recovery will be slower and escaping the ‘middle income trap’ more difficult.