Select your local site for products and services by region

Americas

Asia Pacific

Europe

Location not listed?

Investments
From broad money market exposure to niche private assets our investment managers offer expertise across the investment spectrum.
Mirova Global Sustainable Equity Fund
September 18, 2025
Mirova Global Sustainable Equity Fund
The Mirova Global Sustainable Equity Fund is a conviction-based and multi-thematic ESG strategy investing in international equities
eagle
Next decade investing
The seismic shifts shaping the investment landscape today, and the key trends that will continue to define investor thinking over the next ten years.
About us
Private assets

Infrastructure debt: unlocking Asia’s growth

September 29, 2025 - 8 min
Infrastructure debt: unlocking Asia’s growth

Angus Davidson
Head of Private Debt Real Assets, APAC
AEW

 

Where does infrastructure investing go from here?

From close to zero 25 years ago1, global infrastructure assets owned by institutions now total $1.3 trillion and counting.

Within this total, infrastructure debt, driven by investors’ desire for yield and stable long-term returns, has risen to $168bn, according to Preqin, the data provider.

But infrastructure as an asset class is maturing, and with competition for developed country assets fierce, many investors are now reviewing their options, aiming to maintain or enhance returns without increasing risk*.

Perhaps surprisingly, Asia could be the solution. “Asia has some of the best relative value in infrastructure debt right now,” says Angus Davidson, Head of Private Debt Real Assets, APAC, at AEW, an affiliate of Natixis Investment Managers. “The yields in Asia can be higher, but the overall risk is very similar to the US, Europe and Australia.”

 

The power shift in Asia

Asia remains very much the fastest-growing region in terms of population, GDP, manufacturing and consumption.

Its growth trajectory requires unprecedented scale and speed of infrastructure development. According to the Asian Development Bank, developing Asia will need to invest some $13.8 trillion in infrastructure from 2023 to 2030 to sustain economic growth, reduce poverty and respond to climate change.

Electrical infrastructure will be a major recipient of this investment, as electricity demand expands by 5% a year across Asia2. Another rapidly growing infrastructure segment is data centres, whose owners are increasingly seeking green power. According to Moody’s, data centre capacity in the APAC region will more than double by 2028, growing at a rate of almost 20% per annum.

“Asia’s growth requires a huge amount of power and while fossil fuels will no doubt have to play a part in a ‘just transition’, a large part will be via renewables, with the proportion increasing over time as the economics of green energy keep getting better,” Angus says.

India alone has set a target of 500GW of renewable energy by 2030. This compares to 60W of installed renewable energy in the UK, for example. “It’s a huge step-up in capacity,” Angus says. “Last year India added close to 30GW of renewable power, but they know they can’t do it all on their own, they need outside investment.”

The demand for renewables has been further boosted by net zero targets, which have been set by the majority of Asian governments. The IMF estimates that meeting net zero in developing Asia requires investment of some $1.1 trillion a year to meet government targets, a figure that is out of reach for governments alone.

 

Private assets follow policy incentives

From an investor standpoint, the question is how to harness this enormous, multi-decade opportunity in Asia.

Asian governments are providing the answer themselves, facilitating foreign investment and expertise to help their countries transition from fossil fuel-based growth to more sustainable growth based on renewable energy.

“Historically, Asian infrastructure debt has been dominated by the banking market. With the structures being put in place across Asia, non-bank financial institutions can participate in a deep and steady pipeline of attractively priced green and sustainable assets,” says Angus.

Take the case of India, which currently provides a sizeable and accessible investment opportunity. Deals in India were once complicated to execute, with individual Indian states organising their own renewables procurement and investors often balking at the accompanying lack of transparency and co-ordination.

The Indian government has now seized the transition reins – centralising bidding, making land available for immediate development, simplifying and speeding project approval processes, and offering long-term contracted power supply agreements. The greater certainty over projects has greatly eased the ability to raise debt for them. As a result international banks have increased activities in arranging debt in both local and international currencies.

AEW notes there were a number of large USD denominated infrastructure debt transactions in India in 2024, and more have followed in 2025.

Although the Indian opportunity currently predominates, deal flow from Malaysia and the Philippines is growing fast too. Malaysia’s attractiveness as a data centre location, close to Singapore and with access to renewable energy has seen over USD 5 billion in project financings in the first half of 2025 alone, much of it denominated in USD, supporting large international sponsors.

Likewise, the Philippines has sought to improve its attractiveness to infrastructure investors by amending its Public Service Act to enable 100% foreign ownership of public services, such as energy and data centre projects, and launching its Green Energy Auction Program (GEAP) which has allowed parties to bid for various types of renewables developments – the fourth round in early 2025 sought to add 9.4GW of solar, onshore and offshore wind and storage – the fifth round later in 2025 will focus on offshore wind.

In a similar vein, Vietnam has updated its Power Purchase Agreement rules to allow renewable energy generators to bypass the state utility and sell directly to large consumers.

Angus says: “As a rule, if the right regulations are in place, then what we have seen is that the private sector will follow.”

 

The rise of global financing techniques

Investors with long memories may look askance at the idea of investing in developing Asian countries, given previous experience with defaults and the alarming currency slides during the late 1990s Asian crisis.

Such worries are understandable but misplaced, AEW believes. For a start, private infrastructure debt – which barely existed at the time of the Asian crisis – is the most resilient of all the private credit categories. “The Moody’s default stats are telling,” says Angus. “Over nearly 40 years of data, the default rate for infrastructure has been better than for corporate debt.”3

More importantly, default stats for Asian infrastructure debt are on a par with those in developed markets. Most people would be surprised to learn that they are better than the US, for example, and about the same as Europe.

This may seem counter-intuitive, but there are clear reasons for it.  In developed markets, defaults tend to reflect over-exuberant structuring as competition for assets intensifies. In developing markets, defaults are related more to country risk. However, country risk in developing Asia is now not as acute as in previous years, and heavily mitigated by offshored project finance structures.

These structures typically reflect global financing techniques, with similar participants and security packages. Sponsors, security and accounts can all be offshore from the location of the asset, and project financing facilities often have covenants and triggers to get lenders and sponsors together prior to any defaults.

The result is that a given Asian asset, which looks identical in all but location to a developed market asset, can return around 30bps-40bps a year more to investors.

 

A range of potential diversification benefits

Asian infrastructure debt can introduce significant diversification into a portfolio.

Angus says: “Most people realise the importance of having Asian exposure when seeking diversification across a variety of project finance markets. In developed markets, we are moving towards the end of the cycle – terms and conditions are very competitive, and pricing is waning, so it’s more of a borrower’s market. We are in a different stage of the market in Asia.”

For new investors to the asset class, infrastructure debt offers low correlation to corporate debt and other types of private debt. Direct lending, for instance, is popular among large institutions but can expose them to variable default rates and lower recovery rates which may impair headline returns.

“We see our approach as stocked with unflashy, stable investments with fewer impairment issues,” Angus says. “If you are lending to power stations that keep the lights on, these are essential services so it’s much more stable and prices are less elastic.”

Infrastructure debt can also provide diversification at portfolio level. Although, 50% of AEW’s Asian investments are in renewables, this segment offers great dispersion in its own right, encompassing rooftop and ground solar, off and onshore wind, as well as a range of storage and battery technologies.

 

Making a difference, reaping the benefits

Although ESG principles and standards are generally less embedded in Asia than in Europe, AEW’s approach to Asian infrastructure investment has a strong ESG underpinning.  AEW structured and arranged one of the first project financings in Hong Kong under the Green and Sustainable Finance Certification Scheme, financing a portfolio of rooftop solar assets for the PAG Group. “The ability to act in the primary market sets us apart” says Angus. “We create products that fit our investors’ requirements”.

In fact, the IFC – the largest global development institution focused on the private sector in emerging markets, and part of the World Bank ­– has publicly announced4 its intention to be a major investor in AEW’s emerging Asia environmental and social infrastructure debt strategy.

Asia produces 50% of the world’s greenhouse gas emissions, so there is no net zero without decarbonising Asia, says Angus.  “We both believe we help pave the way to a steady, just energy transition”.

“If people want to make a true impact, and be rewarded financially, they can’t just invest in the OECD. Asia is where they can make a difference and reap the benefits of doing so.”

 

Written in September 2025

*Infrastructure debt investing, like most investments, presents a risk of capital loss.

1 TC Rolfstad, The Case for Private Infrastructure in the Modern Era, Hamilton Lane, 2024.

2 Ember analysis, Asia, 2025.

3 Source: Moody’s default and recovery rates for project finance 1983-2021. As of April 2023.

4 IFC, 2025. 

 

Additional Notes

This material has been provided for information purposes only to investment service providers or other Professional Clients, Qualified or Institutional Investors and, when required by local regulation, only at their written request.  This material must not be used with Retail Investors. It is the responsibility of each investment service provider to ensure that the offering or sale of fund shares or third party investment services to its clients complies with the relevant national law.

Please read the Prospectus and Key Information Document carefully before investing. If the fund is registered in your jurisdiction, these documents are also available free of charge and in the official language of the country of registration at the Natixis Investment Managers website (im.natixis.com/intl/intl-fund-documents).

To obtain a summary of investor rights in the official language of your jurisdiction, please select the appropriate country/your location and then consult the legal documentation section of the website (im.natixis.com/intl/intl-fund-documents).

In the E.U.: Provided by Natixis Investment Managers International or one of its BRANCH offices listed below. Natixis Investment Managers International is a portfolio management company authorized by the Autorité des Marchés Financiers (French Financial Markets Authority - AMF) under no. GP 90-009, and a simplified joint-stock company (société par actions simplifiée - SAS) registered in the Paris Trade and Companies Register under no. 329 450 738, Registered office: 43 avenue Pierre Mendès France, 75013 Paris. Germany: Natixis Investment Managers International, Zweigniederlassung Deutschland (Registration number: HRB 129507). Registered office: Senckenberganlage 21, 60325 Frankfurt am Main. Italy: Natixis Investment Managers International Succursale Italiana (Registration number: MI-2637562). Registered office: Via Adalberto Catena, 4, 20121 Milan, Italy. Netherlands: Natixis Investment Managers International, Dutch BRANCH (Registration number: 000050438298), Registered office: Stadsplateau 7, 3521AZ Utrecht, the Netherlands. Spain: Natixis Investment Managers International S.A., Sucursal en España (Registration number: NIF W0232616C), Registered office: Serrano n°90, 6th Floor, 28006  Madrid, Spain. Luxembourg: Natixis Investment Managers International, Luxembourg BRANCH (Registration number: B283713), Registered office: 2, rue Jean Monnet, L-2180 Luxembourg, Grand Duchy of Luxembourg. Belgium: Natixis Investment Managers International, Belgian BRANCH (Registration number: 1006.931.462), Gare Maritime, Rue Picard 7, Bte 100, 1000 Bruxelles, Belgium.

In Switzerland: Provided for information purposes only by Natixis Investment Managers, Switzerland Sàrl (Registration number: CHE-114.271.882), Rue du Vieux Collège 10, 1204 Geneva, Switzerland or its representative office in Zurich, Schweizergasse 6, 8001 Zürich.

In the British Isles: Provided by Natixis Investment Managers UK Limited which is authorised and regulated by the UK Financial Conduct Authority (FCA firm reference no. 190258) - registered office: Natixis Investment Managers UK Limited, Level 4, Cannon Bridge House, 25 Dowgate Hill, London, EC4R 2YA. When permitted, the distribution of this material is intended to be made to persons as described as follows: in the United Kingdom: this material is intended to be communicated to and/or directed at investment professionals and professional investors only; in Ireland: this material is intended to be communicated to and/or directed at professional investors only; in Guernsey: this material is intended to be communicated to and/or directed at only financial services providers which hold a license from the Guernsey Financial Services Commission; in Jersey: this material is intended to be communicated to and/or directed at professional investors only; in the Isle of Man: this material is intended to be communicated to and/or directed at only financial services providers which hold a license from the Isle of Man Financial Services Authority or insurers authorised under section 8 of the Insurance Act 2008.


In the DIFC: Provided in and from the DIFC financial district by Natixis Investment Managers Middle East (DIFC Branch) which is regulated by the DFSA. Related financial products or services are only available to persons who have sufficient financial experience and understanding to participate in financial markets within the DIFC, and qualify as Professional Clients or Market Counterparties as defined by the DFSA. No other Person should act upon this material.  Registered office: Unit  L10-02, Level 10 ,ICD Brookfield Place, DIFC, PO Box 506752, Dubai, United Arab Emirates

In Taiwan: Provided by Natixis Investment Managers Securities Investment Consulting (Taipei) Co., Ltd., a Securities Investment Consulting Enterprise regulated by the Financial Supervisory Commission of the R.O.C. Registered address: 34F., No. 68, Sec. 5, Zhongxiao East Road, Xinyi Dist., Taipei City 11065, Taiwan (R.O.C.), license number 2020 FSC SICE No. 025, Tel. +886 2 8789 2788.

In Singapore: Provided by Natixis Investment Managers Singapore Limited (NIM Singapore) having office at 5 Shenton Way, #22-05/06, UIC Building, Singapore 068808 (Company Registration No. 199801044D) to distributors and qualified investors for information purpose only. NIM Singapore is regulated by the Monetary Authority of Singapore under a Capital Markets Services Licence to conduct fund management activities and is an exempt financial adviser. Mirova Division (Business Name Registration No.: 53431077W) and Ostrum Division (Business Name Registration No.: 53463468X) are part of NIM Singapore and are not separate legal entities. This advertisement or publication has not been reviewed by the Monetary Authority of Singapore.

In Hong Kong: Provided by Natixis Investment Managers Hong Kong Limited to professional investors for information purpose only.

In Australia: Provided by Natixis Investment Managers Australia Pty Limited (ABN 60 088 786 289) (AFSL No. 246830) and is intended for the general information of financial advisers and wholesale clients only. 

In New Zealand: This document is intended for the general information of New Zealand wholesale investors only and does not constitute financial advice. This is not a regulated offer for the purposes of the Financial Markets Conduct Act 2013 (FMCA) and is only available to New Zealand investors who have certified that they meet the requirements in the FMCA for wholesale investors. Natixis Investment Managers Australia Pty Limited is not a registered financial service provider in New Zealand.

In Korea: Provided by Natixis Investment Managers Korea Limited (Registered with Financial Services Commission for General Private Collective Investment Business) to distributors and qualified investors for information purpose only.

In Colombia: Provided by Natixis Investment Managers International Oficina de Representación (Colombia) to professional clients for informational purposes only as permitted under Decree 2555 of 2010. Any products, services or investments referred to herein are rendered exclusively outside of Colombia. This material does not constitute a public offering in Colombia and  is addressed to less than 100 specifically identified investors.

In Latin America: Provided by Natixis Investment Managers International.

In Chile: Esta oferta privada se inicia el día de la fecha de la presente comunicación. La presente oferta se acoge a la Norma de Carácter General N°336 de la Superintendencia de Valores y Seguros de Chile. La presente oferta versa sobre valores no inscritos en el Registro de Valores o en el Registro de Valores Extranjeros que lleva la Superintendencia de Valores y Seguros, por lo que los valores sobre los cuales ésta versa, no están sujetos a su fiscalización. Que por tratarse de valores no inscritos, no existe la obligación por parte del emisor de entregar en Chile información pública respecto de estos valores. Estos valores no podrán ser objeto de oferta pública mientras no sean inscritos en el Registro de Valores correspondiente.

In Mexico: Provided by Natixis IM Mexico, S. de R.L. de C.V., which is not a regulated financial entity, securities intermediary, or an investment manager in terms of the Mexican Securities Market Law (Ley del Mercado de Valores) and is not registered with the Comisión Nacional Bancaria y de Valores (CNBV) or any other Mexican authority. Any products, services or investments referred to herein that require authorization or license are rendered exclusively outside of Mexico. While shares of certain ETFs may be listed in the Sistema Internacional de Cotizaciones (SIC), such listing does not represent a public offering of securities in Mexico, and therefore the accuracy of this information has not been confirmed by the CNBV. Natixis Investment Managers is an entity organized under the laws of France and is not authorized by or registered with the CNBV or any other Mexican authority. Any reference contained herein to “Investment Managers” is made to Natixis Investment Managers and/or any of its investment management subsidiaries, which are also not authorized by or registered with the CNBV or any other Mexican authority.

In Uruguay: Provided by Natixis IM Uruguay S.A. Office: San Lucar 1491, Montevideo, Uruguay, CP 11500. The sale or offer of any units of a fund qualifies as a private placement pursuant to section 2 of Uruguayan law 18,627. 

In Brazil: Provided to a specific identified investment professional for information purposes only by Natixis Investment Managers International. This communication cannot be distributed other than to the identified addressee. Further, this communication should not be construed as a public offer of any securities or any related financial instruments. Natixis Investment Managers International is a portfolio management company authorized by the Autorité des Marchés Financiers (French Financial Markets Authority - AMF) under no. GP 90-009, and simplified joint-stock company (société par actions simplifiée – SAS ) registered in the Paris Trade and Companies Register under no. 329 450 738. Registered office: 43 avenue Pierre Mendès France, 75013 Paris.

The above referenced entities are business development units of Natixis Investment Managers, the holding company of a diverse line-up of specialised investment management and distribution entities worldwide. The investment management subsidiaries of Natixis Investment Managers conduct any regulated activities only in and from the jurisdictions in which they are licensed or authorised. Their services and the products they manage are not available to all investors in all jurisdictions.

Although Natixis Investment Managers believes the information provided in this material to be reliable, including that from third party sources, it does not guarantee the accuracy, adequacy, or completeness of such information.

The provision of this material and/or reference to specific securities, sectors, or markets within this material does not constitute investment advice, or a recommendation or an offer to buy or to sell any security, or an offer of any regulated financial activity. Investors should consider the investment objectives, risks and expenses of any investment carefully before investing. The analyses, opinions, and certain of the investment themes and processes referenced herein represent the views of the individual(s) as of the date indicated. These, as well as the portfolio holdings and characteristics shown, are subject to change and cannot be construed as having any contractual value. There can be no assurance that developments will transpire as may be forecasted in this material. The analyses and opinions expressed by external third parties are independent and does not necessarily reflect those of Natixis Investment Managers. Any past performance information presented is not indicative of future performance.

This material may not be redistributed, published, or reproduced, in whole or in part.

All amounts shown are expressed in USD unless otherwise indicated.

Natixis Investment Managers may decide to terminate its marketing arrangements for this fund in accordance with the relevant legislation.

 

 

DR-73215