Infrastructure financing across Asia is not constrained by capital. As Steve Mercieca, managing director and head of the infrastructure and development finance group at Standard Chartered, put it, “capital is definitely there”. What is less consistent is how projects are brought to market in a way that allows that capital to be deployed predictably and at scale.

Mercieca operates across Southeast Asia, North Asia, and Australia and New Zealand, spanning both advisory and financing. His team works primarily with sponsors and typically leads or structures transactions across energy, transport, social and digital infrastructure. The work is grounded in execution, covering assets as varied as hospitals in Australia under established public-private partnership frameworks, offshore wind in Korea and Taiwan, renewable energy projects in Indonesia and the Philippines, and advisory work on airports and digital infrastructure across Southeast Asia.

His definition of “beyond borders” financing is practical. “Most infrastructure projects… have a cross-border element,” whether through foreign equity, international contractors or global supply chains. At another level, projects are structurally cross-border, where assets, revenues and regulatory frameworks span jurisdictions. He pointed to initiatives such as the ASEAN Power Grid as a clear example, linking power generation and demand across countries.

These two forms do not scale in the same way. Cross-border participation in domestic projects is now standard. Fully integrated cross-border infrastructure remains more complex, requiring alignment across policy, regulation and market frameworks.

The distinction frames the central issue. Infrastructure financing in Asia is scaling, but it is still built “project by project”, rather than through a system that allows capital to be deployed consistently across markets.

Capital is global, but deployment into Asia depends on structure and certainty

Capital available for infrastructure is global, mobile and increasingly diversified, but its deployment into Asia is shaped by how projects are structured and presented to investors.

The scale is well established. Industry estimates, including those from the Asian Development Bank, point to infrastructure investment needs exceeding $100 trillion globally through 2040, with a significant share, often cited at around two-thirds, concentrated in Asia. This reflects both new build requirements and the upgrading of existing assets, with Asia accounting for the bulk of greenfield development.

What differentiates markets is not access to capital, but how clearly projects are brought forward. Mercieca noted that “people know what they are getting in for… this is my return, this is my tariff, and these are my risks” in markets where frameworks are more predictable. This clarity allows investors to move from evaluation to commitment without extended delays.

The Philippines provides a clear example. The government has established a centralised approach to renewable energy development, with strong government support for power purchase agreements (PPAs). This creates a defined revenue structure for projects, allowing investors to assess risk and return with a high degree of confidence. Demand for these assets has been strong, supported by the consistency of the framework.

Where this level of structure is less developed, capital deployment is slower and more selective. Investors are still active, but participation tends to be more transaction-specific rather than pipeline-driven. The difference is not the availability of capital, but the degree of predictability around project economics, contractual frameworks and regulatory processes.

This variation across markets shapes how capital is deployed across the region, influencing both the pace of investment and the ability to build sustained pipelines of projects.

Capital flows are accompanied by expertise, capability and execution experience

Cross-border flows into infrastructure are not limited to capital. They increasingly bring technical expertise, execution capability and operating experience, which shape how projects are developed and delivered in Asia.

Mercieca pointed to the growing role of investors from the Middle East, Europe and China, not just as providers of funding but across the value chain. Sovereign and strategic investors are entering markets such as Indonesia and the Philippines with established capabilities in project development, construction and operations. In the case of Middle Eastern investors, this includes large-scale renewable energy deployment experience built in domestic markets.

He cited Saudi Arabia as an example, where solar projects are being executed at a scale of several gigawatts per project and delivered in rapid succession. That experience does not remain domestic. When capital from these investors enters Southeast Asia, it is accompanied by technical knowledge, execution models and procurement discipline developed at scale.

European strategic players are also active. Transactions involving firms from Europe reflect this pattern, where capital deployment is tied to operational capability and sector expertise. These investors are not passive financiers. They are involved in structuring, developing and operating assets, particularly in renewable energy.

China’s role is similarly integrated. Chinese sponsors and state-owned enterprises bring construction capability, supply chain depth and manufacturing capacity, particularly in solar and infrastructure development. Their participation spans engineering, procurement and construction (EPC) as well as equity investment, allowing projects to be executed with a high degree of vertical integration.

This combination of capital and capability is visible in blended finance structures as well. In Indonesia, a 92MW renewable energy project in West Java under the Just Energy Transition Partnership (JETP) involved local utility Perusahaan Listrik Negara (PLN), development finance institutions such as Proparco, DEG and Standard Chartered as the sole commercial bank. The project combined concessional capital, commercial financing and local execution, reflecting how different sources of funding and expertise are brought together.

For banks, this changes the nature of their role. Financing is no longer a standalone activity. It involves connecting capital providers with sponsors, aligning technical and financial structures, and ensuring that projects can move from concept to execution within local regulatory and market conditions.

The result is a financing environment where capital, capability and execution experience are increasingly integrated, shaping both how projects are structured and how they are delivered across the region.

Infrastructure financing remains project-led rather than system-driven

Infrastructure financing across Asia continues to develop one transaction at a time, rather than through a fully systematised pipeline.

Mercieca described the market as fundamentally sponsor-driven. Projects originate from developers who identify opportunities, secure initial approvals and then approach banks to structure and raise financing. The role of the bank is complementary to the sponsors’ initiatives. “The deals we do are client-driven… we are supporting the client,” he noted.

By the time projects reach lenders, they are typically well advanced. Sponsors would already have engaged with governments, secured land, assessed technical feasibility and begun addressing regulatory requirements. Financing is not the starting point, but a later stage built on prior groundwork, with eventual financing bankability embedded throughout the development process.

Progress depends on local approvals, stakeholders and regulatory conditions. Even within the same sector, structures can differ depending on market frameworks and counterparties.

There are signs of gradual standardisation in certain markets. In North Asia, offshore wind projects in Taiwan and Korea have developed through successive transactions that build on previous structures. Each project incorporates lessons from earlier deals, creating greater consistency over time. Similar patterns are beginning to emerge in parts of Southeast Asia, although at a slower pace.

At the regional level, initiatives such as the ASEAN Power Grid point towards a more integrated approach but remain at an early stage of development.

The market continues to evolve through individual transactions rather than through a fully developed system.

Execution discipline determines whether projects reach financing and completion

Infrastructure projects rarely fail at the financing stage. By the time they reach lenders, most have already gone through a long period of development that is focused on ensuring eventual financing bankability.

Mercieca noted that projects are typically advanced beyond just an idea before they are brought to the banking market. Sponsors would have engaged governments, secured land, assessed technical feasibility and developed a preliminary structure. Financing follows this groundwork.

Where projects are delayed or do not proceed, the issues tend to arise earlier. Planning and sequencing are critical. Sponsors need clarity on land acquisition, environmental approvals, supply chains and cost structures at the outset. If these are not addressed upfront, projects stall.

Environmental and social requirements are a common constraint. These are core components of project development, not secondary checks. Lenders and development finance institutions apply strict standards, including environmental impact assessments and land resettlement processes. If these are not properly managed, projects do not reach financial close.

The number of stakeholders involved increases execution risk. Infrastructure projects bring together governments, sponsors, lenders, contractors and regulators, often across jurisdictions. Delays in approvals, policy changes or misalignment between parties can slow progress.

At the same time, projects that enter formal financing processes are usually those that have already met key thresholds of feasibility. The filtering happens early. By the time financing is arranged, most viable projects are able to proceed.

Local currency financing is becoming the default for long-term infrastructure

Infrastructure financing in Asia is increasingly structured in local currency, reflecting the need to align long-term revenues with long-term liabilities.

Most infrastructure assets generate revenues in domestic currency, particularly where offtake agreements involve state entities or regulated tariffs, such as PPAs with utilities including PLN.

For long-duration assets, this creates a structural constraint. As Mercieca put it, “local currency funding provides a natural FX hedge for loans, for example, a peso loan to support PPA revenues in pesos”.  FX hedging markets for local currencies in South East Asia might not be deep enough to fully offset a loan that does not have a natural FX hedge risk.

Local currency financing has therefore become more prevalent across markets such as the Philippines, Thailand and Malaysia. Governments are also encouraging this shift, particularly where state entities are the offtakers.

International banks continue to play a role alongside domestic lenders, combining local currency access with structuring and distribution capabilities. This allows projects to be financed in a way that reflects both local cash flows and broader capital participation.

The market is layered across local banks, regional banks, global banks and alternative capital

Infrastructure financing in Asia is supported by a mix of institutions with different mandates, balance sheets and geographic reach.

Mercieca described three broad groups on the banking side. Local banks are highly liquid but largely domestic in focus. Institutions such as Kasikornbank and Siam Commercial Bank in Thailand, and Bank Mandiri in Indonesia, provide significant local currency funding.

Regional banks operate across multiple markets within Asia. Banks such as DBS, OCBC, United Overseas Bank and Maybank bring cross-border reach within the region, allowing them to participate in transactions across Southeast Asia while maintaining strong domestic franchises.

Global banks, including Standard Chartered and HSBC, as well as Japanese and European institutions like BNP Paribas, connect international capital to local projects and structure transactions across jurisdictions. Japanese banks such as MUFG remain active in long-term infrastructure lending across the region.

Development finance institutions and multilateral development banks play a central role alongside commercial banks. Organisations such as the Asian Development Bank provide long-tenor funding, risk mitigation instruments and political risk coverage, often supporting overall project bankability.

Alternative capital sources are also expanding. Sovereign wealth funds, infrastructure funds and private credit providers are increasingly active, particularly in larger or more complex transactions. In Asia, private credit remains selective, given the depth of bank liquidity.

Outlook depends on scaling execution while connecting capital across borders

Infrastructure financing across Asia is active, supported by sustained demand across energy transition, digital infrastructure and transport. Activity across markets such as the Philippines, Indonesia, Thailand and Malaysia remains strong.

Cross-border infrastructure is also becoming more visible. Initiatives such as the ASEAN Power Grid, including proposals for power imports into Singapore from Indonesia, Malaysia and Vietnam, reflect a shift towards regional integration. These projects extend beyond domestic frameworks and require coordination across jurisdictions, making them more complex to structure and execute.

The scale of demand in Asia remains significant, particularly in new infrastructure rather than replacement. This continues to attract capital but also requires markets to bring forward projects in a way that can support repeated execution rather than isolated transactions.

Within this environment, Mercieca described the role of Standard Chartered as connecting capital flows and adapting international structuring experience with local execution. The bank operates across both domestic and international markets, combining access to local currency liquidity with the ability to structure and distribute financing across jurisdictions. “We are in a position to connect capital… and help these flows materialise into infrastructure projects,” he said.

This positioning reflects the structure of the market itself. Capital originates globally but is deployed locally, requiring alignment between investors, sponsors and regulatory frameworks. Banks that can operate across these dimensions play a central role in enabling transactions.

The extent to which infrastructure financing scales across the region will depend on how consistently these elements are brought together into projects that can be executed and replicated across markets.