New Lower Mekong Climate Fund aims to cut 8 million tonnes of emissions while supporting more than 300,000 people.
Deutsche Bank has helped launch a Green Climate Fund (GCF)-backed private equity climate fund designed to accelerate regenerative agriculture and sustainable food systems across Southeast Asia’s Lower Mekong region.
The new Mekong Earth Regeneration Fund (Merf) aims to reduce approximately 8 million tonnes of emissions, support more than 300,000 people and advance the transition toward sustainable and climate-resilient agriculture and food systems.
The initiative represents a blended finance model intended to mobilize greater public and private investment into regenerative agriculture and sustainable land use, sectors that have historically faced limited access to long-term capital in emerging markets.
RELEVANT SUSTAINABLE GOALS
Green Climate Fund Commits US$50 Million Through Deutsche Bank
As an accredited entity of the Green Climate Fund, Deutsche Bank has facilitated a US$50 million investment by the GCF into the Mekong Earth Regeneration Fund.
The investment is expected to attract additional capital at a ratio of 3:1, underscoring how blended finance can help accelerate climate investment in emerging markets.
According to the programme, the investment plays a catalytic role by enabling the fund to mobilize additional co-financing from both public and private investors. By reducing investment risk through a blended finance structure, the fund is designed to attract institutional capital into regenerative agriculture and sustainable land-use sectors.
The Green Climate Fund is the world’s climate fund for developing countries, mobilizing capital at scale, strengthening institutions and driving transformative change through global partnerships.
Regenerative Agriculture at the Core of the Investment Strategy
The Mekong Earth Regeneration Fund will invest in agribusinesses and agricultural value-chain companies that work directly with smallholder farmers across the Lower Mekong region.
Its investments will support the transition toward lower-emission and climate-resilient agricultural practices, including regenerative farming, agroforestry and sustainable aquaculture.
The programme focuses on improving soil health, reducing chemical inputs and strengthening ecosystem resilience while helping build more sustainable food production systems.
Long-Term Equity Capital Targets Climate Finance Gap in Vietnam and Laos
The investment model is designed to address a critical shortage of climate finance in emerging markets such as Vietnam and Laos, where private equity resources for regenerative agriculture and other priority sectors remain limited.
By providing equity capital, the Mekong Earth Regeneration Fund offers long-term financing that enables investee companies to expand regenerative agriculture and sustainable land-use activities without immediate repayment pressure.
The approach is intended to support businesses seeking patient capital to implement climate-focused investments over longer time horizons.
Mekong Capital to Manage Fund While Deutsche Bank Oversees Programme
Deutsche Bank will provide oversight throughout the programme, ensuring capital is deployed in accordance with Green Climate Fund policies, including international environmental and social standards.
The bank will oversee implementation of the programme, while Mekong Capital will serve as fund manager by investing capital through the Mekong Earth Regeneration Fund.
Merf is the dedicated impact initiative of Mekong Capital, a Vietnam-focused private equity firm specializing in growth capital investments.
Mekong Capital is known for its Vision Driven Investing approach, through which it partners with management teams to achieve breakthrough business performance.
Public-Private Partnership Seeks to Expand Climate Investment Across Southeast Asia
The programme highlights the growing role of public-private partnerships in climate finance, particularly in regions where high upfront risks and long investment payback periods have historically constrained private investment.
Kamran Khan, Deutsche Bank’s Head of Sustainable Finance for Asia-Pacific and the Middle East and Africa, said blended finance structures play an important role in expanding climate investment.
“Blended finance structures like Merf are critical to unlocking private capital at scale,” Khan said. “By combining concessional funding with institutional investment, we can accelerate innovative climate solutions to reduce emissions in markets that can be perceived as higher risk.”
By combining Green Climate Fund financing, Deutsche Bank’s programme oversight and Mekong Capital’s investment management, the Mekong Earth Regeneration Fund seeks to channel long-term capital into regenerative agriculture, sustainable land use and climate-resilient food systems across the Lower Mekong region.
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