Why Asean’s next decade will shape the global energy transition
With energy demand rising and climate risks escalating, Maybank is teaming up with partners to bridge the capital gap for a more sustainable future
EVERY day, more than 600 million people across Asean use electricity, and the International Energy Agency (IEA) estimates that energy demand is set to rise by 60 per cent by 2040. Meeting this surge will require a dramatic scale-up in renewable energy capacity.
Growth has been promising with green industries taking shape and governments across Asean committing to energy transition, albeit at different speeds. International capital has followed. Since 2020, the number of foreign clean energy investment projects in Asean has grown by an average of 15 per cent annually, led by China, Japan and South Korea, according to Zero Carbon Analytics.
“Asean is attracting investors with its wealth of energy transition opportunities. With abundant sunlight, strong wind corridors, hydropower potential and access to critical minerals such as nickel, the region is primed for solar, wind, battery storage, and electric vehicle (EV) production,” said John Chong, group chief executive officer of Global Banking, Maybank.
In a multipolar world, Asean countries such as Singapore and Malaysia can play a key role in mobilising green capital, anchoring the region as a pivotal player in the global clean energy transition.
Yet the IEA warns that clean energy investments must rise to US$190 billion (S$247 billion) annually by 2035 – about five times current levels – if Asean is to meet its climate goals. “Much more can be done. We need the transition to net zero to be accelerated and on a different scale to close this sizeable investment gap,” Chong noted.
The new triangle: Asean, China and the Gulf
An emerging source of capital into Asean is potentially the Gulf Cooperation Council (GCC) states, namely Saudi Arabia, the UAE, Qatar, Kuwait, Bahrain, and Oman. Renewable energy plays a central role in masterplans such as Qatar’s and Saudi Arabia’s Vision 2030.
As Asean Chair in 2025, Malaysia had unveiled an ambitious vision for a trilateral partnership linking Asean, the GCC, and China. “This is a potential game-changer as these three regions collectively account for nearly a quarter of the world’s population and economic output,” said Ranita Abdullah, head of ESG Strategy and Solutions at Group Global Banking, Maybank.
While existing Asean-Gulf, Asean-China and Gulf-China ties are already significant – China, for example, is the Gulf’s largest trading partner and is a major foreign direct investor and trading partner of Asean – a broader partnership offers more strength than bilateral ties alone. “A trilateral partnership of this scale could reshape global trade and investment flows, particularly in clean and low-carbon energy,” added Ranita.
There are already deals and partnerships being established. For instance, Maybank’s client, UEM Lestra, a subsidiary and green industries arm of UEM Group, had signed a strategic partnership agreement with Saudi Arabia’s ACWA Power to conduct a feasibility study and jointly develop renewable independent water and power plant facilities in Malaysia.
As an indication of interest in Asean, the Qatar Investment Authority has opened an office in Singapore, while Saudi Arabia’s Public Investment Fund has established a base in Hong Kong.
Maybank has been facilitating GCC sovereign wealth funds’ interests and investments in Asean renewable projects, and expects more to follow. Familiarity is key as the region gains recognition for more attractive valuations than Europe and the US, Ranita said.
Closer to home, one flagship initiative that could anchor the vision of the trilateral co-operation is the Johor-Singapore Special Economic Zone that harnesses the complementary advantages of Malaysia’s resources and Singapore’s financial hub status. Of strategic interest would be the construction of the Asean Power Grid to enable cross-border electricity exchange, with Singapore pledging to import 30 per cent of its power from low-carbon sources by 2035.
“The proposed grid would increase regional energy security, with Johor state potentially anchoring this green corridor to connect Malaysia and Singapore, a major buyer,” said Chong of Maybank.
Maybank’s role in facilitating investments
Based on some transactions that have taken place, Gulf sovereign wealth funds and government-related entities may require a deal size of at least US$250 million and a sizeable pipeline visibility for acquisitions. Maybank has been playing an active role in mobilising capital towards energy transition goals – advising clients on project bankability, de-risking and their sustainability frameworks to align with regional taxonomies.
The bank has developed its own Transition Finance Framework, and outlined decarbonisation pathways that include science-based interim targets and strategies for the major economic sectors: power, palm oil, steel and aluminium, automotive, and commercial real estate.
From 2021 to nine months ended 2025, Maybank has mobilised about RM156 billion (S$49 billion) in sustainable finance, surpassing its 2025 target ahead of schedule. Notable deals that Maybank had facilitated in terms of financing include Tenaga Nasional Berhad Power Generation’s hydropower project in Malaysia. VinFast of Vietnam has spread its wings regionally, investing in a plant in Indonesia financed by Maybank.
In Greater China, Maybank is facilitating cross-border transactions for Envision Energy, a global green technology leader, into other parts of Asia. In Singapore, it has financed green projects across large corporates, mid-caps and SMEs such as ACEN Renewables International and LYS Energy Solutions.
More recently, the bank – alongside two Singapore banks – executed the country’s first transition finance deal, as recognised by the Singapore-Asia Taxonomy for Sustainable Finance, for YTL PowerSeraya Pte. Limited.
“As a leading Asean financial institution with a presence in 10 key markets of the region, as well as in Greater China and the Middle East, Maybank is well-positioned to facilitate cross-border investments and trade for sustainable growth,” said Chong.
Ranita added, “We are committed to being a transition partner of choice, supporting clients across Asean on their decarbonisation journey and promoting inclusive development. We recognise the journey is not linear and we are in for the long haul.”
A defining decade
The next decade will be decisive for Asean. With energy demand rising fast and the effects of climate change, the region faces both a challenge and an opportunity for global energy transition investors.
“Asean’s success will hinge on mobilising capital, having clear policy actions, and forging new alliances,” said Chong.
“With Singapore and Malaysia playing key roles, the region can position itself as an active architect in shaping the global energy transition conversation.”
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