KKR, GIP Initiate Coalition to Enhance Indo-Pacific Infrastructure
Editorial StaffThe Facts -
- KKR and Global Infrastructure Partners are launching a coalition to promote infrastructure investment in emerging economies of the Indo-Pacific Economic Framework, with over $25 billion in capital that can be deployed.
- The coalition's initial focus will be on investments in the energy, transport, water and waste, and digital sectors in the Indo-Pacific region.
- Private equity firms and pension managers, including KKR, Stonepeak, and APG Asset Management, have recently launched infrastructure funds targeting investments in these areas.
Infrastructure Investment Coalition Forms in Indo-Pacific Economic Framework
A coalition organized by KKR and Global Infrastructure Partners (GIP) has been announced to foster infrastructure investment in the emerging economies of the Indo-Pacific Economic Framework (IPEF). The US companies will co-chair this initiative, also created under the US-led Indo-Pacific Partnership for Prosperity (IP3).
IPEF includes the United States, India, and 12 Pacific Rim economies, excluding China. The coalition's purpose is to expedite infrastructure investment, enabling IPEF economies in meeting their economic development, human capital, and sustainability objectives. Other members include GIC and Temasek Holdings in Singapore, GIP, which is being acquired by BlackRock, and others. It is estimated that the coalition members together can deploy over $25 billion in capital into infrastructure investments in Indo-Pacific emerging markets.
“This coalition unites Indo-Pacific investors, knowledge partners, governments, and development experts to realize the achievable goal of bridging the investment gap in IPEF partner countries,” stated David Talbot, IP3's executive director.
Ivy League Expertise
The IPEF, launched in May 2022, aims to enhance the resilience, sustainability, inclusiveness, economic growth, fairness, and competitiveness of member economies, including Australia, Brunei, Fiji, Indonesia, Japan, South Korea, Malaysia, New Zealand, the Philippines, Singapore, Thailand, and Vietnam.
Investments across the energy, transport, water and waste, and digital sectors will be the coalition's initial focus. Knowledge will be drawn from Columbia University’s School of International and Public Affairs' Center on Global Energy Policy.
Joe Bae, co-CEO of KKR, emphasized the need for accelerated infrastructure investment in the Indo-Pacific region. KKR, one of Asia's largest infrastructure investors, announced the $6.4 billion final close of its second Asia-dedicated infrastructure fund in January.
Fundraising Follows Suit
Following KKR's new fund, which has already allocated more than half of its capital across 10 investments, infrastructure funds have been launched by US private equity firm Stonepeak and Dutch pension manager APG Asset Management. Stonepeak announced the final closing of its first Asia infrastructure fund with $3.3 billion in capital commitments in March.
APG has partnered with Japan’s GPIF to explore opportunities to invest in developed market infrastructure. Both institutions launched a joint program in April to focus on investment opportunities aligning with both pension funds' long-term strategies.
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