A global partnership between governments and financial institutions that aims to mobilize $100 billion for sustainable projects over the next five years will be announced on the sidelines of an ongoing UN summit Addis Ababa, Ethiopia.

The UN Financing for Development Conference opened yesterday (July 13) and will run until July 16.

The World Economic Forum and the Organisation for Economic Co-Operation and Development (OECD), through the work of the Forum’s ReDesigning Development Finance Initiative (RDFI), will formally announce three Blended Finance initiatives aimed at unlocking hundreds of billions of dollars of investment to help meet the United Nations Sustainable Development Goals (SDGs).

Blended Finance seeks to attract private-sector investment and finance alongside development finance and philanthropic funds to manage risks and enhance returns.

It offers a win-win-win option for all parties: wins for development finance and philanthropic funders, as they make their limited dollars go further; wins for private investors, as they generate attractive returns, and most importantly, wins for populations in developing countries, as more funds are channelled to their communities in ways that enables sustainable growth in the world’s poorest countries.

Initiatives to be announced include:

•    A Sustainable Development Investment Partnership (SDIP), a global partnership between governments and financial institutions that provides practical solutions to unlock private capital for financing sustainable infrastructure and other development needs.

•    Convergence, a virtual platform for deal-making, sharing information and capacity building that facilitates and increases Blended Finance capital flows to developing countries.

•    The RDFI Toolkit, comprises a set of materials including knowledge products and a virtual community, the Blended Finance Network, to support the scaling up of Blended Finance as a mainstream, systematic practice.

A recent survey conducted on behalf of the World Economic Forum identified 74 pooled funds and facilities representing $25.4 billion in Blended Finance assets, with the funds impacting over 177 million lives, demonstrating the tremendous potential of Blended Finance to close the funding gap required to finance the ambitious SDG agenda and deliver development outcomes.

“Expanding public-private cooperation in the form of Blended Finance is one of the most important ways the international community can support developing countries as they seek to generate significant amounts of domestic and foreign investment required to meet their Sustainable Development Goals by 2030,” said Richard Samans, head of the Centre for the Global Agenda, and member of the Managing Board, World Economic Forum.

“These kinds of initiatives can help catalyse domestic and foreign private capital at much greater scale by mitigating the risks that impede investors from pursuing otherwise attractive infrastructure and industrial investment opportunities that would create jobs and reduce poverty,” he added.

The first Blended Finance Initiatives will be formally announced at the United Nations Financing for Development Conference in Addis Ababa on July 15. Senior ministers and international financial institutions will discuss how Blended Finance can help achieve the SDGs.

‘’There is plenty of money in the world available for sustainable development. Blending public and private finance is the best way to mobilize the $4 trillion needed to achieve the proposed Sustainable Development Goals,” said Erik Solheim, chair, Development Assistance Committee (DAC), OECD. – TradeArabia News Service