Mobilising Private Finance Towards 2030 and Beyond

Panel: What lessons can be learnt from the GSSS bond market?

Panel: Taking stock – the reform of MDBs and the mobilisation of private finance

By linking scale with impact, green, social, sustainability and sustainability-linked (GSSS) bonds hold immense potential for mobilising private finance towards sustainable development. The session will highlight the trends, main drivers, challenges, and opportunities of the GSSS bond market – including the incentives and disincentives for both issuers and investors to enter this space. The discussion will focus specifically on the role that development actors and other key stakeholders can play in overcoming the disincentives and increasing the incentives around GSSS bonds, to ultimately scale up the use of these instruments. In doing so, the session will highlight the findings from the OECDLuxSE survey on investor incentives for public sector GSSS bonds.

As the world faces a convergence of crises, MDBs' resources are in greater demand than ever. Calls to reform the international financial architecture underscore the urgency. MDBs not only need additional resources, but they also need to use these resources more effectively. This session sets out the role of the MDBs in mobilising private capital in developing countries, by outlining their current role in the development finance architecture. It will highlight the importance of the MDB reform agenda – and how to ensure that pathways to deliver reform live up to their potential and mobilise private finance at scale. It will also dive into how MDBs can more effectively use their balance sheets to mobilise more private finance.

How can data and transparency enable private financial flows to developing countries?

At the crossroads between crises and development: the role of blended finance in crises and conflict-affected contexts

Lack of data is a key barrier that prevents private capital from flowing to emerging markets and developing economies (EMDEs). The session will focus on the challenges and opportunities of demystifying emerging markets through data to help investors better price risk and make data a lever of private investment. It will focus on the specific data needs of the private sector for different instruments and via different mobilisation channels. The discussion will also zoom in on potential pathways ahead in ensuring that these needs are met – especially by outlining the roles that different market players can play. Finally, it will highlight the role that transparency can play in making lending decisions and managing exposure risks, thereby attracting private investors, and ensuring regulatory compliance.

The development community agrees on the need to address conflicts and crises, as global security is a prerequisite to sustainable development. This session will dive into the role and potential of blended finance in conflict and crises-affected contexts, with focus on relevant examples across different geographies – especially Ukraine, among others. It will outline the current landscape of blended finance in these contexts and highlight the main challenges and opportunities for development finance providers to unlock additional resources for reconstruction and development. In particular, the session will explore how international development actors can better implement blended finance instruments and approaches to address these crises and build resilience.

Local currency financing: Exploring the challenges and policy solutions available for donors, DFIs and MDBs

Mobilising private finance for biodiversity in developing countries: Understanding entry points for development actors

Scaling local currency financing solutions remains crucial for mitigating exchange rate risks, strengthening domestic financial markets and in enhancing economic resilience in developing countries. This session sets out to highlight the obstacles that hinder effective local currency financing, particularly relating to the development of local financial markets. Panellists will discuss solutions, current and potential, that development actors can deploy to overcome these obstacles and what this would mean for investors. The session will specifically explore the role that DFIs and MDBs can have in providing blended finance solutions to
improve access to local currency funding, and to support policies that foster more resilient local financial markets.

This session will dive into the potential of development finance to unlock private finance for biodiversity in developing countries. It will explore the challenges and opportunities of the private sector to support biodiversity-related projects (e.g. conservation, agroecology, nature-based solutions), and tap into the role of development co-operation providers in scaling-up their efforts. It will also seek to better understand existing policy levers and financial mechanisms to mobilise private finance for biodiversity action. The aim of this session is to reflect on evidence, policies and action needed to scale financing for biodiversity, including through blended finance.

Regulatory barriers and unintended consequences that inhibit private finance flows to EMDEs

Navigating Structured Funds: How best should we structure Collective Investment Vehicles to de-risk Private Finance Investments?

Regulatory barriers can create challenges and uncertainties that deter foreign investors. This session will focus on the regulatory barriers that hinder private sector finance from flowing to developing countries, including in pivotal sectors such as climate finance. It will build on and explore the effects – following the implementation of Basel III, Solvency II and other major regulations – on lending practices and cross-border investments from global private sector actors into emerging markets and developing countries, with particular attention on sustainability and climate-related regulations.

Understanding how best to leverage structured funds across different sectors and geographies is crucial to ensuring that resources are allocated efficiently, concessionality is minimised, and the commercial viability of these projects can be maintained in high-risk markets. This session will address the key challenges to establishing structured blended finance funds. Through a series of case studies spanning various sectors and regions, the session will look to offer insights into setting appropriate concessionality levels and achieving optimal risk-return profiles across different investment tranches within these collective investment vehicles.

Strategic asset allocation: How can we get investors to invest in developing countries?

Impact and blended finance: how much do we (not) know?

Investors tend to favour traditional markets for their investments. The session will dive into what factors are preventing them from investing in emerging markets. It will explore concrete solutions to overcoming these barriers – including, for example, the aggregation of small-scale projects into deals large enough for global investors, and the role of local capacity building and technical assistance in supporting local solutions.

For blended finance to be a development tool, and to guarantee its integrity, we need to ensure that it generates development impact for the final beneficiaries in emerging markets. This session will explore how much we (don't) know about the development impacts of blended finance, how practitioners assess them ex-ante and ex-post, and how development finance providers integrate an impact lens when designing blended finance transactions.