Opinion: How DFIs could do billions more with their money
By Samantha Attridge & Christian Novak - January 2023
https://www.devex.com/news/opinion-how-dfis-could-do-billions-more-with-their-money-104766
Bilateral DFIs like the U.K.’s British International Investment, the US International Development Finance Corporation, and Norway’s Norfund could have mobilized an extra $13 billion for investment in 2020 alone. Here's how.
Bilateral development finance institutions, or DFIs, like the U.K.’s British International Investment, the U.S. International Development Finance Corporation, or DFC, and Norway’s Norfund must make better use of their capital. They can do much more to alleviate the ballooning SDG and green financing gaps caused by recent multiple overlapping crises. According to our new research and calculations made exclusively for Devex, at a conservative estimate, these three DFIs could have mobilized an extra $13 billion for investment in 2020 alone.
Development aid is of course in retreat in many donor countries. The U.K. has cut £3 billion in aid spending in 2021 and traditionally generous Scandinavian donors such as Sweden and Norway are also cutting theirs. But the need for additional funds is urgent and this prompted us to look at what larger contribution DFIs could make, using the capital they already have.
Recently the World Bank and other multilateral development banks have been under pressure to stretch their resources and reform (and the World Bank has recently presented a road map for change to its shareholders). In the same vein, bilateral DFIs can also surely do more.