De-Risking Emerging Markets Investments

Investing in emerging and developing markets offers a unique opportunity to generate yield while potentially financing positive social impact. The Business and Sustainable Development Commission identified $12 trillion of market opportunities aligned to the Global Goals for Sustainable Development. Unfortunately, the regulations designed to create stability in the financial system after the 2008 financial crisis have had the opposite impact in the developing world because of the disincentives to invest in those markets. With heightened capital and liquidity requirements, commercial banks—the natural financial intermediaries that find, structure, and sell deals to institutional investors—are on the sidelines. In this session, panelists will discuss how public sector institutions can better use guarantees and other risk mitigation tools to draw in private finance for sustainable development.