Asian Development Bank helps deploy clean fuel buses in China
The Asian Development Bank (ADB) and PROPARCO, the subsidiary of Agence Française de Développement (AFD) focusing on private sector funding, have signed an unfunded risk participation agreement to boost lease financing of clean buses by Far East Horizon Ltd. in the People’s Republic of China (PRC). Buses must meet stringent emissions and energy efficiency criteria, running on cleaner fuels such as CNG, LNG or biomethane, or involving hybrid or electric motors.
As part of the agreement, ADB provided a $100 million senior loan with PROPARCO’s participation amounting to $20 million. The agreement will allow Far East Horizon Ltd., one of the major Chinese financial services companies, to expand its activities in the public transportation market with a focus on clean buses to replace older diesel bus fleets.
“The long term funding to the financial leasing company is part of ADB’s commitment to promote green transportation in the PRC by reducing greenhouse gas emissions of public bus fleets,” said Christine Engstrom, Director for Financial Institutions at ADB’s Private Sector Operations Department.
PROPARCO Deputy CEO for Operations Amaury Mulliez welcomed the partnership agreement with ADB, and said: “This transaction will contribute to the mobilization of clean buses in the PRC’s public transport system. It will initiate a strong partnership between ADB and PROPARCO and promote our joint operations in Asia.”