Deutsche Bank advances Mekong Capital’s impact fund backed by the Green Climate Fund

Deutsche Bank is helping launch a new private equity climate fund in Southeast Asia, backed by the Green Climate Fund (GCF). The Mekong Earth Regeneration Fund (MERF) aims to reduce approximately 8 million tons of emissions, support more than 300,000 people, and advance the transition to sustainable and resilient agriculture and food systems across the Lower Mekong region^[1].

GCF is the world’s climate fund for developing countries, mobilising capital at scale, strengthening institutions and driving transformative change through its global partnerships. As an Accredited Entity of GCF, Deutsche Bank has facilitated a US$50 million investment by GCF in the new climate fund, which is expected to attract capital at a 3:1 ratio, underscoring how blended finance can accelerate climate investment in emerging markets. The investment plays a catalytic role in enabling the fund to mobilize additional co-financing from public and private investors by using a blended finance structure to reduce risk and attract institutional capital into the regenerative agriculture and sustainable land-use sectors.

MERF will invest in agribusinesses and value-chain companies that work directly with smallholder farmers, supporting the transition to lower-emission and climate-resilient practices. These include regenerative farming, agroforestry and sustainable aquaculture, with a focus on improving soil health, reducing chemical inputs and strengthening ecosystem resilience.

Deutsche Bank provides oversight for the programme, ensuring capital is deployed in line with GCF policies, including international environmental and social standards. The bank oversees fund implementation while Mekong Capital will provide fund manager services by investing capital.

The model is designed to address a critical gap in climate finance in emerging markets such as Vietnam and Laos, where there is a lack of private equity resources available for investments in regenerative agriculture and other priority sectors. By providing equity capital MERF provides long-term funding for investee companies to invest in regenerative agriculture and sustainable land use without immediate repayment pressure.

MERF is the dedicated impact initiative of Mekong Capital, a Vietnam-focused private equity firm specializing in growth capital investments. As a private equity investor in multiple market-leading companies in Vietnam, the firm is known for its Vision Driven Investing approach, through which it partners with management teams to achieve breakthrough business performance.

Blended finance structures like MERF are critical to unlocking private capital at scale. By combining concessional funding with institutional investment, we can accelerate innovative climate solutions to reduce emissions in markets which can be perceived as higher risk. Kamran Khan, Deutsche Bank’s Head of Sustainable Finance for APAC & MEA

Hemant Mandal, GCF Regional Director for Asia and the Pacific said: “This investment demonstrates the strategic power of GCF’s catalytic climate finance to crowd in much larger investment flows from public and private sector. With an ambitious target size, the project aims to support several companies in the agro-forestry sector, promoting sustainable land-use practices and low-emission development pathways in Lao People’s Democratic Republic and Viet Nam. The project reflects GCF’s commitment to adopt innovative finance solutions to deliver capital at scale for climate action.”

The programme highlights the increasing role of public-private partnerships in climate finance, particularly in regions where upfront risks and long payback periods have historically limited private investment. 

^[1] MERF funding approval