Deputy prime minister Fadillah Yusof, who is also energy transition and water transformation minister, said Asean’s energy transition could not occur in isolation and that no country could achieve its sustainability goals without strong regional cooperation.
“The depth of our collaboration will determine how swiftly and effectively we decarbonise our economies while safeguarding energy security and affordability.
“While the Asean Taxonomy for Sustainable Finance is a commendable step forward, we must strive to go further,” he said in his keynote opening address at the 2025 Asean Banking and Finance Summit here today.
Asean requires an estimated US$1.5 trillion in climate investment by 2030 to align with global sustainability goals, according to the International Energy Agency.
Fadillah said sustainable finance regulations should be harmonised across Asean to reduce investor uncertainty and facilitate cross-border capital flows.
“We must standardise green bond frameworks, align environmental, social, and governance (ESG) disclosure requirements, and enhance carbon credit mechanisms to make cross-border investments in clean energy seamless and efficient.
“The financial sector must lead this transformation. From funding large-scale renewable projects to supporting small and medium enterprises in adopting green technologies, financing solutions must be innovative, inclusive and accessible to all,” said Fadillah.
He also emphasised the importance of strengthening public-private partnerships to share investment risks and accelerate clean energy projects; utilise blended finance models by combining concessional funding with private investment to enhance the bankability of green projects; and expand carbon markets and transition bonds to unlock new sources of capital while incentivising companies to decarbonise.
He said Malaysia had already taken bold strides in this direction, enhancing green investment incentives, expanding green sukuk offerings, and improving corporate access to renewable energy through the corporate renewable energy supply scheme.
Through Energy Exchange Malaysia, the country is also leading regional integration efforts, facilitating cross-border renewable energy trade, including with Singapore, and ensuring efficient capital flows, he said.
On the role of the banking and financial sector, Fadillah said it was no longer solely about lending, but about leading with structured financial solutions, de-risking green projects, and supporting businesses in their transition towards sustainability.
“With the new technologies that are coming in… the financial sector has to lead and facilitate.
“It is no longer about the traditional banking system. You have to be creative and innovative so that it will suit the requirements of industry players, the direction of the government, the direction of the world. Otherwise, if you go by the conservative approach, there’s no lending.
“More importantly, it has to be affordable and it has to be sustainable, then only will there be security in terms of supply of energy and so on,” he added.