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17 Oct 18

5 blended finance highlights from the World Bank meetings in Bali

By Aakif Merchant
5 blended finance highlights from the World Bank meetings in Bali

Each fall, the World Bank Group (WBG) and the International Monetary Fund (IMF) hold an annual meeting that brings together central bankers, ministers of finance & development, private sector executives, representatives of civil society organizations, and academics to discuss issues of global concern, including the world economic outlook, poverty eradication, economic development, and aid effectiveness.

Blended finance took centre stage at this year’s meeting in Bali, Indonesia. Here are five highlights from the week:

Tri Hita Karana Roadmap for Blended Finance

To mobilize commercial capital towards the SDG financing gap and ensure the delivery of the 2030 agenda, blended finance stakeholders and actors need to engage in a coordinated effort, collectively championing the application of high standards and shared values throughout the financing process.

To this end, the Organization for Economic Co-operation & Development (OECD) along with partners such as Convergence, the Blended Finance Taskforce and other international institutions released the Tri Hita Karana Roadmap for Blended Finance, which pushes for a common narrative and collective action for all stakeholders engaged in mobilizing private sector capital towards the SDG’s.

Report of the DFI Working Group on blended concessional finance in private sector projects

A new report jointly prepared by a myriad of development finance institutions (DFIs), offers extensive data and insights on the extent to which blended finance was deployed by DFIs in 2017.

The report found that in in 2017, more than $8.8 billion in private investment projects were supported by about $1.2 billion in concessional funds channeled by 23 development finance institutions, including the International Finance Corporation (IFC), African Development Bank (AfDB), and the Asian Development Bank (ADB), amongst others. The joint report showed that DFI’s invested about $3.9 billion of their own commercial funds into these projects, with approximately $3.3 billion being crowded in from private lenders and investors.

IFC & Finland announce new initiative building on blended finance partnership for climate change

IFC and the Government of Finland announced a new initiative to catalyze private sector investments for climate change solutions in low-income countries and in fragile and conflict affected states. The new facility will identify and develop innovative projects to be supported by the Finland-IFC Blended Finance for Climate Program and will help IFC undertake early-stage project development activities in new and innovative areas, such as battery storage. The new program will also seek investments that support developing countries in their efforts to adapt to the effects of climate change, through the creation of risk-sharing facilities that will provide financial protection following natural disasters and climate change related events.

SDG Indonesia One

The Indonesian Ministry of Finance launched an integrated blended finance investment platform called SDG Indonesia One, which will support large-scale SDG-aligned projects in Indonesia. The platform will be managed by PT SMI (Indonesia’s national infrastructure financing institution) and has announced $2.34 billion in commitments out of a target of $4 billion.

The Billion Dollar Fund for Women

The Billion Dollar Fund for Women (TDBF) launched at the annual meeting, seeks to employ a blended finance approach to mobilize $1 billion in support of women entrepreneurs and women founded and led companies. The consortium, led by TDBF co-founders K. Shelly Porges and Sarah Chen, has already secured pledges of over $460 million from global investors including Gobi Partners, Golden Gate Ventures, Rethink Impact, and Springboard Growth Capital, amongst others.

About the Author
Aakif Merchant
Aakif Merchant

As Director, Engagement & Capacity Building at Convergence, Aakif works with key stakeholders, such as governments, development finance institutions, and commercial investors, to mainstream blended finance across investment, portfolio management, and policy. To this end, he has worked closely with UNDP, Sweden International Development Agency, Global Affairs Canada, African Development Bank, Private Infrastructure Development Group, Africa Guarantee Fund, the Governments of Switzerland, Indonesia and Ethiopia, and others. Aakif serves as an Advisory Group Member of the Ethiopia-Canada Blended Finance Initiative and is a Lecturer and Advisory Board member at the Initiative for Blended Finance at the University of Zurich. He has spoken on international development finance issues at major events including the OECD Private Finance for Development Conference, East Africa Banking Forum, Green Climate Fund Private Investment for Climate Conference, Latin American Impact Investing Forum, and Sankalp Africa Forum. Aakif has also written about international development finance for numerous publications. He holds an MBA from the University of Toronto and a BA in Economics and Politics from George Washington University. Aakif is currently based in Kigali, Rwanda and has worked across a range of countries including Ethiopia, Indonesia, Colombia, Kenya, India, Switzerland, Tanzania, Sweden and Jordan among others.

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