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Dr. Hubert Danso

CEO and Chairman, Africa investor (Ai) Group
Chairman of the CFA New York Society Global Asset Owners’ Advisory Council
Chairman of the African Sovereign Wealth & Pension Fund Leaders Forum
Chair, African Union ’s (AU) Heads of State Continental Business Network (CBN)

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World Bank‑IMF Spring Meetings: Investors Call for Priority Investor Status to De‑risk & Scale Allocations to African NDCs

By Events, NewsNo Comments

African NDC‑Aligned Green Industrial Infrastructure as a Globally Competitive Investable Asset Class

Executive Summary

During the World Bank-IMF Spring Meetings, investors advocated for the creation of Priority Investor Status (PIS), a proven framework designed to de‑risk and scale the mobilization of institutional capital for Africa’s NDC‑aligned green industrial infrastructure and SDG‑aligned investments. PIS would provide institutional investors with essential protections, transparency, and prioritization—unlocking allocations from over $300 trillion in global private assets. By contrast, the collective balance sheet of Multilateral Development Banks (MDBs) stands at just $2 trillion. A mere 1% reallocation from global private capital could dwarf MDB capacity by more than 1 500%, enabling a transformative, programmatic scaling of Africa’s sustainable investment pipeline.

MDB Preferred Creditor Status – Lessons and Limits

MDBs have historically enjoyed Preferred Creditor Status (PCS), a key factor in their ability to de‑risk investments and achieve exceptionally low default and high recovery rates. According to Fitch Ratings and Moody’s Ratings, PCS has delivered an average 94.9% recovery rate and an average 1.06% default rate over 40 years of sovereign‑backed lending. This demonstrates PCS’s power to boost investor confidence in challenging environments.

However, PCS is exclusive to MDBs and cannot be extended to the broader pool of private institutional capital. The $2 trillion collective balance sheet of MDBs is vastly insufficient for Africa’s scale of infrastructure and climate needs.

In contrast, the global private institutional capital pool exceeds $300 trillion. Allocating even 1% of this pool to African green industrial infrastructure and SDG projects would generate $3 trillion—over 1 500% of MDB capacity. Yet, this capital remains largely untapped due to perceived political, governance, and enforcement risks.

The Case for Priority Investor Status (PIS)

PIS builds on the de‑risking precedent of PCS but retools it for private investors. By embedding legal protections, policy prioritization, and transparency into sovereign‑backed projects, PIS creates a new tier of protected capital:

  1. Legal Frameworks: National investment laws codify PIS protections.
  2. Institutional Investor‑Public Partnerships (IIPPs): Align public goals with private capital mandates.
  3. International Model Legislation: Ensures enforceability and cross‑border consistency.

PIS unlocks Africa’s green industrial potential by:

  • Offering private capital clear legal protections
  • Providing end‑to‑end transparency
  • Ensuring enforceability of government commitments, reducing perceived risk and enhancing liquidity

Why Africa, Why Now

Africa is the final frontier for the global green industrial economy—boasting super‑abundant renewables, natural capital, and rising industrial demand. Yet political, governance, and enforcement uncertainties deter risk‑averse institutional investors, leaving private capital on the sidelines.

By embedding PIS into priority NDC‑backed infrastructure projects, African governments can de‑risk these projects, unlocking trillions in private capital via IIPPs, and positioning the continent for global competitiveness.

How PIS Transforms Barriers into Scalable Investment

PIS enables these investments to be packaged, rated, and scaled like mainstream global assets by:

  • Lowering perceived risk through formal protections and prioritization mechanisms
  • Enabling large institutional investors to meet fiduciary mandates
  • Creating investable indices and ETFs from aggregated, de‑risked assets
  • Triggering large, programmatic allocations—not isolated pilot projects
Investor Barrier PIS Response Impact
Policy unpredictability Binding government commitments to prioritize climate‑aligned investments in budgets and repayment cycles Reduces sovereign policy risk
Legal insecurity Codified legal privileges (priority in debt workouts, enforceable contract terms)  Enhances legal certainty
Default risk perception Structured de‑risking via blended finance, guarantees, and co‑investment from MDBs/sovereign platforms  Narrows the risk premium
Data opacity Mandated disclosure, performance tracking, and alignment with AI‑driven platforms like GEMs3.0  Builds transparency and investability
Limited exit options Regulatory incentives for listed sustainability‑linked securities and tokenized portfolios  Increases liquidity and tradability

 

From Theory to Practice – Implementation Strategy

  1. Legal Reform
    Develop and implement a Priority Investor Status Model Law, codifying investor prioritization, transparency, and enforceability across African nations.
  2. Regulatory Enablement
    Align national development planning and infrastructure procurement pipelines with PIS‑backed IIPPs to signal stability and build investor confidence.
  3. Platform Integration
    Integrate PIS contracts and risk analytics into the GEMs3.0 AI Investment Risk Platform for dynamic monitoring, real‑time pricing, and capital mobilization at scale.
  4. Pilot Portfolios
    Launch $5 Bn+ reference portfolios of climate‑aligned African infrastructure assets, structured with PIS protections, indexed via GEMs3.0 to demonstrate scale and performance.
  5. Institutional Investor Engagement
    Secure mandates from asset owners and managers to allocate capital to PIS‑backed investments, supported by sovereign guarantees, legal assurances, and transparency tools.

Conclusion

Africa’s green industrial infrastructure is one of the world’s most attractive yet undercapitalized opportunities. Without a robust de‑risking framework, private capital will remain on the sidelines. With $300 trillion in institutional assets vs. $2 trillion in MDB capacity, Priority Investor Status transcends policy innovation—it is an economic imperative to scale investments, deliver risk‑adjusted returns, and meet global climate, nature, and development goals.

References

 

April 22, 2025
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The Fiduciary Failure: How Trillions Were Lost by Underinvesting in Emerging Markets By Dr. Hubert Danso, Africa investor (Ai)

By BusinessNo Comments

Global investment fund fiduciaries, tasked with maximizing returns for their beneficiaries, have systematically failed to fulfill their fiduciary duty over the past two decades. This failure is not due to poor market timing or execution but stems from a persistent underinvestment in emerging markets (EM). The cost of this oversight is staggering: trillions of dollars in foregone returns, leaving pension funds, endowments, and stakeholders worse off.

A Fiduciary Blind Spot

Morgan Stanley’s analysis reveals that global investors allocate only 6-8% of their portfolios to EM equities—well below rational benchmarks like GDP weighting (39%), market weighting (13-17%), or the 27-37% suggested by modern portfolio theory. This allocation gap underscores a costly misalignment between asset allocation and optimal risk-adjusted returns.

This is more than a missed opportunity; it reflects a critical gap in tools and frameworks available to fiduciaries. Despite their obligation to act in the best interests of stakeholders, investment consultants, managers, and boards of trustees have systematically bypassed the superior returns and diversification benefits offered by EM equities.

The Trillion-Dollar Opportunity Cost

The financial consequences of under-allocating to EM are monumental. From 2003 to 2023, EM equities delivered annualized returns of 9.2%, outpacing developed market equities at 6.7%, based on MSCI indices. This 2.5% annual performance gap, compounded over decades, translates into trillions in unrealized gains across the $50 trillion managed by global funds.

Consider this:
• If just 7% of global portfolios had been allocated to EM equities over the past 20 years, the segment would have generated $3.2 trillion in returns.
• A rational allocation of 20% would have yielded $9.1 trillion.

This equates to a missed opportunity of nearly $6 trillion—foregone growth that could have directly benefited retirees, university endowments, and other stakeholders.

A Structural Challenge

Why do global investment managers consistently underweight EM despite the clear data? Several structural and psychological factors explain this persistent underinvestment:
1. Home Bias: A tendency to favor familiar developed markets over less familiar EMs.
2. Benchmark Constraints: Portfolios tied to indices heavily skewed toward developed markets, inherently limiting EM exposure.
3. Perceived Risk: While EMs are often labeled as volatile, these risks are mitigated through diversification across regions and sectors.
4. Short-Termism: The pressure to deliver quarterly results drives a focus on stability over long-term growth.
5. Regulatory Barriers: Frameworks like Solvency II nudge institutional allocators toward safer, more liquid assets, inadvertently discouraging higher-potential EM investments.

These barriers collectively constrain fiduciaries, leaving portfolios under-diversified and underperforming in the face of global growth trends.

The Real Victim: The Fiduciary System

Ironically, the true victim of this underinvestment is not emerging markets but the fiduciary system and its stakeholders. Pensioners, students, and sovereign wealth fund beneficiaries have been deprived of trillions in additional value—resources that could have been reinvested in their futures.

This fiduciary lapse becomes even more glaring in light of EMs’ evolving dynamics:
• EM economies now account for 39% of global GDP and are advancing in financial sophistication.
• High-growth industries like technology, manufacturing, and internet services outside China are driving sustained expansion.
• Structural reforms, improved governance, and institutional investor-public partnerships are reducing risks and stabilizing markets.

Ignoring these shifts leaves portfolios unprepared for the next phase of global economic growth.

GEMs3.0: Closing the Allocation Gap

Addressing this fiduciary failure demands a fundamental shift in how funds analyze and allocate to EMs. Traditional tools and benchmarks, while valuable, often lack the depth needed to navigate EM complexities.

This is where GEMs3.0, a next-generation AI platform for institutional investors, steps in. Designed to enhance fiduciary decision-making, GEMs3.0 integrates:
• Comprehensive Market Intelligence: Real-time insights on EM opportunities across sectors and geographies.
• Risk-Adjusted Frameworks: Tools to optimize returns while managing perceived risks.
• Actionable Insights: Facilitating informed, long-term decisions aligned with fiduciary mandates.

By leveraging GEMs3.0, funds can systematically close the allocation gap, unlocking billions in incremental returns annually while upholding their fiduciary responsibilities.

The Future of Fiduciary Responsibility

Emerging markets are no longer a speculative gamble—they are a strategic necessity. For investment funds, the time to act is now. Platforms like GEMs3.0 empower fiduciaries to align portfolios with long-term global growth trends, ensuring stakeholders benefit from the diversification and performance these markets offer.

The cost of inaction is clear. By continuing to under-allocate, global funds are leaving trillions on the table. With the right tools and strategies now available, the question is no longer if but when fiduciaries will seize this transformative opportunity.

April 7, 2025
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South Africa’s G20 Presidency: A Defining Moment for Institutional Investor-Public Partnerships (IIPPs) for Green Industrialisation

By NewsNo Comments

We applaud South Africa’s G20 Presidency under the unifying and inspiring theme of Solidarity, Equality, and Sustainability.

This Presidency has already demonstrated its resolve by integrating Africa’s economic and industrial priorities into the global investment dialogue, seamlessly aligning domestic and international asset owner mandates with Climate and Sustainable Development Goals (SDGs).

As Universal Owners, the African and global institutional investment community looks forward to working closely with South Africa’s G20 Presidency and its Presidential Economic Advisory Council. Through Institutional Investor-Public Partnerships (IIPPs) for Green Industrialisation, we can advance a shared vision for a more inclusive, equitable, and resilient global economy.

With converging agendas—from South Africa’s G20 Presidency and the Finance COP29 Presidency to the G7, the UN Financing for Development Summit, BRICS, and Brazil’s COP30 Presidency—2025 promises to be a watershed opportunity for mobilizing private capital at scale to accelerate green industrialisation in emerging markets and developing economies.

🌱 Let’s align public and private mandates to turn sustainable investment into equitable global progress for the benefit of people, planet, and nature. 

January 29, 2025
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Dr. Hubert Danso Returns to Adjudicate Finance for the Future Awards 2025

By News, Press Release

Africa investor (Ai) confirmed today that Dr. Hubert Danso, its CEO and Chairman, will return to the high-level judging panel for the prestigious 2025 Finance for the Future Awards. Dr. Danso previously served on the adjudication panel for the 2022 Finance for the Future Awards.

The Finance for the Future Awards were established in 2012 to recognize financial leadership in building sustainable economies. The awards also highlight the critical role of the finance function in fostering innovation and integrated thinking.

The Finance for the Future Awards platform is a partnership between Deloitte, the Institute of Chartered Accountants in England and Wales (ICAEW), and Accounting for Sustainability (A4S).

Dr. Danso is a member of the A4S Advisory Council. A4S was established by His Majesty King Charles III in 2004, during his tenure as The Prince of Wales, to convene global finance, investment, and accounting leaders. Its mission is to catalyze action on sustainability and transform finance to make sustainable business the norm.

2025 Finance for the Future Awards Judges include:

  • Dr. Hubert Danso, CEO and Chairman, Africa investor (Ai) Group
  • Brian D. Lawson, Co-Vice Chairman, Brookfield Corporation
  • Mark Hawkins, Chair, A4S, and former President and CFO Emeritus, Salesforce
  • Andrew Karolyi, Charles Field Knight Dean and Harold Bierman Jr. Distinguished Professor of Management, Cornell University
  • Javier Echave, Chief Operating Officer, Heathrow Airport Holdings Limited
  • Liz Barber, Chair, ICAEW Risk Committee
  • Mardi McBrien, Chief of Strategic Affairs & Capacity Building, IFRS Foundation
  • Professor Jan Bebbington, The Rubin Chair in Sustainability in Business, Director of the Pentland Centre, Lancaster University
  • Ed Humpherson, Head, Office for Statistics Regulation (OSR)

The Finance for the Future Awards are globally recognized as highly reputable accolades within the sustainability arena. Their key ambition is to share best practices, drive awareness, inspire action, and foster a community of finance leaders committed to creating more sustainable outcomes for their organizations and the industry.

Ends

December 12, 2024
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How Institutional Investor- Public Partnerships Can Drive GreenTech Innovation Beyond Moore’s Law

By News
Dr. Hubert Danso, Chairman, Africa investor (Ai) Group
 
Every year of delayed green technology deployment costs the world an estimated $1.6 trillion in climate damages and lost opportunities—a stark reminder of the urgency to act.
 
As the world grapples with a mounting climate finance emergency, scaling green technologies is critical for achieving net-zero targets and mitigating climate change’s worst effects. Despite significant achievements, such as an 85% reduction in solar energy costs over the past decade, green technologies have yet to achieve the exponential advancements seen in digital technologies under Moore’s Law.
 
Systemic barriers like entrenched fossil fuel dominance, regulatory inertia, and integration challenges for renewable energy continue to impede progress. However, these barriers also offer an opportunity to rethink strategies for investing in, financing, deploying, and scaling green innovations.
 
With over $300 trillion in assets under management, institutional investors are uniquely positioned to drive transformative change. By leveraging Institutional Investor-Public Partnerships (IIPPs), they can accelerate, de-risk, and scale green technology deployment at a rate that surpasses Moore’s Law.
 
Five Key Levers to Accelerate Green Innovation
  1. Mandate-Aligned Investment Frameworks
Institutional investors and governments must align mandates to unlock green technology’s full potential. Long-term policy stability, as exemplified by the Nairobi Declaration and the Paris Agreement, provides a predictable environment for investments. Innovative de-risking mechanisms, including private-to-private risk re-characterization programs and blended finance models such as public guarantees and first-loss structures, are crucial. These approaches, seen in the European Green Deal and the U.S. Inflation Reduction Act, unlock private capital for sustainable projects on a transformative scale.
 

2. Aggregated Investment Vehicles for Scale

Green projects often remain too fragmented for institutional investors to engage. Vehicles like the African Green Infrastructure Investment Bank (AfGIIB) aggregate smaller initiatives across renewable energy, industrial manufacturing, and critical mineral processing into institutional-grade portfolios.

This strategy minimizes transaction costs, diversifies risk, and enhances liquidity, enabling large-scale green technology deployment in regions with the greatest demand.

3. Leverage Digital Technologies for Scalability

Cutting-edge technologies such as AI, machine learning, and big data are key accelerators for green innovation. These tools optimize energy storage, facilitate predictive maintenance for renewable infrastructure, and enhance smart grid efficiency.

Platforms like GEMs3.0 deploy AI-driven asset allocation to scale green investments while managing risks effectively. By integrating digital and green technologies, IIPPs can replicate the exponential growth dynamics of Moore’s Law in the energy sector.

4. Policy Advocacy and Infrastructure Development

Regulatory hurdles and outdated infrastructure delay green technology adoption. IIPPs can play a leading role in advocating for streamlined permitting, modernized energy grids, and the construction of new transmission infrastructure.

International forums such as UNFCCC-COP, G7, G20, and BRICS are critical for establishing global standards and promoting best practices to accelerate renewable energy deployment.

5. Market Leadership Coalitions

Effective coalitions that unite institutional investors and public-sector leaders are pivotal for scaling green industrialization. Initiatives like the AfGIIB and key global events, such as South Africa’s G20 Presidency, position Africa as a prime destination for green industrial capital. Such coalitions create market signals that reinforce investment flows, policy stability, and adoption of transformative technologies.

 
 
Accelerating Green Innovation: Analytical Examples
 
1. Solar Energy Deployment: Compressing 30 Years into a Decade
  • Timeline Comparison: Solar photovoltaic (PV) costs dropped by 85% from 2010 to 2020, surpassing Moore’s Law’s pace (~30% cost reduction per decade). Public-private collaborations like Germany’s Energiewende drove this achievement.
  • Acceleration with IIPPs: Aggregated investment mechanisms like the AfGIIB could further compress timelines, achieving global solar cost parity by 2030, delivering in 7–10 years what previously took decades.
2. EV Battery Manufacturing: Halving Gigafactory Timelines
  • Timeline Comparison: Lithium-ion battery costs fell by 97% between 1991 and 2023, paralleling Moore’s Law. However, gigafactory construction still averages 3–5 years per facility.
  • Acceleration with IIPPs: Institutional investments in modular gigafactory designs could reduce timelines to 2 years, effectively doubling global EV battery capacity within a decade.
3. Green Hydrogen: Achieving Parity in a Single Decade
  • Timeline Comparison: Green hydrogen is expected to achieve cost parity with gray hydrogen by 2035–2040.
  • Acceleration with IIPPs: Investments in Green Industrial Cities, innovation hubs, and hydrogen corridors backed by AI-optimized infrastructure and IIPP frameworks could advance cost parity to 2030, shortening the timeline by up to 10 years.
 
The Path Forward: Exceeding Moore’s Law for Green Technologies
 
The systemic challenges that slow green technology deployment are significant but surmountable. Through mandate alignment, project aggregation, digital innovation, policy reform, and coalition-building, Institutional Investor-Public Partnerships can accelerate the energy transition beyond the pace of Moore’s Law.
 
This approach requires bold leadership, creative solutions, and unwavering dedication. The payoff is monumental: achieving a net-zero future that not only delivers risk-adjusted returns for institutional investors but also ensures a sustainable planet for generations to come.
 
The clock is ticking. The moment for exponential progress is now—let’s seize it.
December 5, 2024
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How development banks are failing to attract enough private money to climate fight

By News
As officials from around the world strive this week to reach a deal on funding for poorer countries to tackle climate change, investment manager Rob Drijkoningen is the sort of person they’re hoping will help get them there.
 
Drijkoningen is head of emerging market debt at U.S. asset manager Neuberger Berman, which holds $27 billion in sovereign and corporate debt from developing countries. He should be a natural partner for multilateral development banks (MDBs) looking to find private sector investors for projects to slow climate change or cope with its effects.
 
Boosting private sector investment is, for rich nations, a crucial part of clinching a deal at the COP29 climate talks in Azerbaijan this week on a global commitment for annual funding to fight climate change – dubbed the New Collective Quantified Goal. Development banks committed to increase their lending to poorer countries to $120 billion a year by 2030. They also pledged to bring in an additional $65 billion annually in private sector cash to those nations.
 
But Drijkoningen, after speaking with the European Investment Bank (EIB) and European Bank for Reconstruction and Development (EBRD) about potential deals this year, decided there were too many hurdles to investment. Development banks, he said, are not willing to open their books and share enough information about investments’ risks. Nor do they allow private investors to pick and choose the projects that interest them. For asset managers already facing limited appetite from clients for long-term infrastructure assets in developing nations, those obstacles make investment unappealing.
 
“We would need to get a true sense of a level playing field: of getting equal access to information so that we can appropriately assess the merits,” Drijkoningen said. “That’s a cultural issue that I doubt we have come close to changing.”
Cash-strapped Western governments are pinning their hopes on a massive increase in private sector investment to reach the $2 trillion-plus, opens new tab needed annually to help poorer countries move to greener energy and protect against the impacts of extreme weather.
 
After a resounding win by climate denier Donald Trump in this month’s U.S. presidential election, worries are rising that the financing gap will steadily widen if Washington – and its dollars – pulls out of the global climate fight. An ongoing, two-year reform of multilateral institutions like the World Bank – aimed at overhauling the way they lend to make more use of their money – helped drive a 41% increase in the mobilisation of private sector funds to low income countries in 2022 across 27 development banks, a report this year showed, opens new tab.
 
The head of the EBRD, Odile Renaud-Basso, told Reuters the bank was working hard to provide more information to the private sector, but there were some limits to what could be made public.
But a Reuters analysis of lending data and interviews with two dozen development banks, climate negotiators, private sector investors and non-profits showed that change at multilateral lenders needs to accelerate significantly if the private sector is to fulfil its hoped-for role.
 
The analysis of total aggregate lending last year provided by 14 of the world’s top development banks showed that for each dollar invested across all markets just 88 cents of private money was sucked in. And that fell to just 0.44 cents of private money to poorer countries. Here, the banks made climate finance commitments of $75 billion and mobilised $33 billion of private investment.
 
A report by a group of independent experts, opens new tab for the G20 group of industrialised nations last year on how to strengthen multilateral development banks said the target that needed to be hit was $1.5 to $2 for every $1 of lending.

SLOW PROGRESS

Governments – which bankroll development banks – are pushing them to go reform faster. That should result in a more ambitious funding target in Baku – and help countries to skirt a politically contentious discussion on increasing the banks’ capital.
 
The EBRD now delivers $3.58 of private money for every $1 it invests across its portfolio, up from $2 dollars three years ago. IDB Invest – the private sector arm of the Inter-American Development Bank (IDB) – has also embarked on an overhaul of its business, helping to increase IDB Group’s mobilised private capital fivefold from 2019 to 2023 to $4.4 billion.
There are various ways for multilateral lenders to pull in private sector cash. The most established one is parceling up parts of their own loans and selling them to private investors, freeing up money to lend again. These so-called B-loans have been around for more than six decades.
 
But Nazmeera Moola, chief sustainability officer at asset management firm Ninety One, said that a raft of issues – including long lead times and returns that were sometimes unattractive – had diminished the appeal of these assets.
 
Meanwhile, many large institutional investors, such as pension funds or insurance companies, think of direct investing through corporate or project finance lending in emerging markets as “scary stuff”, she added.
 
Harmen van Wijnen, chair of the board of Dutch pension fund ABP, which has invested 1 billion euros in B-loan funds managed by development finance specialist ILX, said that taking the leap into unfamiliar risks – like project finance in emerging markets – would need to be mitigated by guarantees from multilateral lenders.
 
Some MDBs are already providing guarantees or structures that help reduce the risks, for example by hedging the risk of a collapse in the local currency. At COP29, some banks have flagged new initiatives including a move by the United States to guarantee $1 billion of existing loans to governments by the Asian Development Bank so it can lend a further $4.5 billion to climate-friendly projects.
 
The EBRD’s Renaud-Basso told Reuters it was also looking to guarantee sovereign lending to free up more money, without providing further details. Guarantees aside, the reluctance of some development banks to play the junior partner in project lending, amid pressure to land big deals and maximise their own returns, was leaving them in competition with private sector investors, according to half a dozen sources in the industry.
 
Gianpiero Nacci, EBRD Director for Sustainable Business and Infrastructure, said that while MDBs were starting to change their culture and structures to make them more focused on attracting private sector investment, it was a “work in progress”.
 
“We’re increasingly incentivising our banking teams to focus on mobilization,” he said, noting the EBRD is introducing internal targets beyond its own direct investment. Given the scale of the climate challenge, some development experts are choosing to go it alone, among them Hubert Danso, chief executive of Africa Investor, a platform that connects private investors with green infrastructure projects on the continent.
 
“We have an MDB market failure which is incapable of crowding in the private capital required,” he said.
 
Total amount of private climate finance in million U.S. dollars to countries around the world as mobilized by multilateral development banks has resumed its rise following the COVID-19 trough.
Total amount of private climate finance in million U.S. dollars to countries around the world as mobilized by multilateral development banks has resumed its rise following the COVID-19 trough.

CULTURAL HURDLES

In an August document, the Organisation for Economic Cooperation and Development (OECD), which tracks the climate finance efforts of multilateral institutions, found lack of data was a “major obstacle” to raising private investment to the required levels.
 
The previously unpublished report, reviewed by Reuters, said a shortfall in transparent data was leading to private investors mispricing investment risk.
“For efficiency of markets, data is critical,” said Haje Schutte, a deputy director at the OECD. “There is an ethical and fairness dimension to that: these public sector institutions have a role to beyond their institutional self-interests.”
 
Some development banks are worried about sharing their proprietary information and require the OECD to sign non-disclosure agreements, Schutte said.
Alert to the criticism and following an investor consultation, MDBs have increased the credit risk data shared in a database called GEMs, originally designed to be used for information exchange between the banks themselves. Since March, some data on recovery rates for public as well as private lending has been made available and, in October, more historic data was offered. But some investors are demanding more granular risk information.
 
Erich Cripton, a director at Canadian pension fund CDPQ Global, which has over $300 billion in assets under management, said investors have been pushing for MDBS to publish more data in the GEMS database. He said the released data reflected the MDBs preferred creditor status meaning that for a private investor, the risk was higher.
 
For Nadia Nikolova, lead portfolio manager at Allianz Global Investor, who has raised over $3.5 billion in development finance and impact credit strategies, the lack of information hampers her ability to raise and invest capital in developing economies.
 
“Institutional investors have a fiduciary duty to invest money responsibly,” she said. “If I don’t have that information, I can’t price the risk.” Abdullahi Khalif, Somalia’s chief climate negotiator, acknowledged on the sidelines of the COP29 talks that investing there was riskier than in industrialized economies, but added those who did so had opportunities for good returns in areas including renewable energy and irrigation.
 
“The only private sector that can come is a private sector that is really looking forward to taking the risk.”
 
Source: Reuters
November 19, 2024
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G20 Nature Investment Roadmap Tabled by SMI Africa Council for Bold Global Action

By News

Leaders urged to prioritize nature as a cornerstone of economic resilience and climate action.

On the closing day of the G20 Summit, the Sustainable Markets Initiative (SMI) Africa Council (SMIAC) tabled the G20 Nature Investment Roadmap: A Leaders’ Guide to Formalizing African Nature as an Investable Asset Class on Public and Private Balance Sheets.

This pivotal roadmap, championed by the SMI Africa Council, calls on G20 Heads of State to redefine economic frameworks by embedding natural capital as an investable asset class. It provides a clear and actionable strategy for the global community to recognize the immense economic value of nature while safeguarding it for generations to come.

Nature: The Foundation of Global Resilience

Nature is the bedrock of societal well-being, economic stability, and climate resilience, yet it remains grossly undervalued. As global leaders increasingly recognize the critical link between natural ecosystems and economic vitality, the demand for investable, verifiable, and quantifiable commitments to restore and preserve nature has reached unprecedented levels.

The annual global nature investment gap has ballooned to $800 billion, highlighting the urgent need for bold, transformative global action. The Roadmap underscores the importance of institutional investor-public partnerships to scale up capital flows and deploy investments that protect biodiversity, mitigate climate risks, and unlock sustainable growth—particularly in Africa, a continent uniquely positioned to lead this effort.

Unlocking Africa’s Natural Capital for Global Prosperity

Africa’s natural capital—its forests, wetlands, biodiversity, and ecosystems—offers a transformative economic opportunity. Properly integrating this capital into corporate and public accounting systems will attract billions in financing, drive progress toward the Sustainable Development Goals (SDGs), and fulfill Nationally Determined Contributions (NDCs).

Dr. Hubert Danso, Co-Chair of the SMI Africa Council, stressed the urgency of action:
“Institutional investors commanding over $300 trillion globally can decarbonize their portfolios, but they cannot de-nature them. By fostering institutional investor-public partnerships, we can create a nature-positive investment landscape that delivers for nature, people, and the planet.”

Five Bold Actions for Leaders

The Roadmap calls on Heads of State to demonstrate “Nature Investment Statesmanship” by taking five decisive actions:

  1. Champion the integration of International Accounting Standard (IAS) 37 and IAS 38 to report emissions and nature investments as obligations and assets.
  2. Incentivize private ecosystem investment through tax breaks under IAS 38.
  3. Establish national natural capital frameworks to quantify and account for biodiversity and natural assets in NDC’s and national strategies.
  4. Invest in geo-spatial data infrastructure to enable accurate and transparent natural capital reporting.
  5. Encourage private institutions to mainstream natural capital in risk assessments and transition plans.

Closing the Gap, Building a Sustainable Future

The Roadmap offers detailed recommendations to standardize accounting frameworks, embed IAS 37 and IAS 38 standards, and bridge the $800 billion annual funding gap for nature-positive investments. These efforts are essential for addressing the interconnected crises of climate change and biodiversity loss.

A Global Call to Action

With the historic opportunities presented by South Africa’s G20 Presidency, the Finance COP29 Presidency, and Brazil’s COP30 Presidency, the SMI Africa Council’s Roadmap serves as a transformative blueprint for integrating natural capital into global economic systems.

Dr. Danso concluded:
“Together, we can deliver transformative global climate action that benefits nature, people, and the planet—today and for generations to come.”

Read the full Roadmap

Ends

About The Sustainable Markets Initiative (SMI) – www.sustainable-markets.org

Established by His Majesty King Charles III and launched at Davos, The Sustainable Markets Initiative (SMI) is the ‘go-to’ CEO-led private sector organisation on the transition to a sustainable future.

About The SMI Africa Council (SMIAC)

The SMI Africa Council (SMIAC) was led by His Majesty King Charles III in recognition of the current realities of the African continent’s 1.3 billion people, and the shared ambition of its 55 countries to establish a common position through the Nairobi Declaration (Africa’s Green Investment Deal) in combatting climate change, biodiversity loss and fulfilling its Nationally Determined Contributions (NDCs) and the Sustainable Development Goals (“SDGs”).

Launched in November 2023 in Nairobi, Kenya, the SMIAC champions scalable collective action by business, finance/investment, and government leaders to benefit people, the planet, and nature.

 

November 19, 2024
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Natural Capital on African Governments’ Balance Sheets initiative introduced at COP16

By News

The Sustainable Markets Initiative (SMI) Africa Council has unveiled a new initiative aimed at making natural assets a core component of national balance sheets.

The Natural Capital on African Governments’ Balance Sheets initiative is an institutional investor-public partnership led by the SMI Africa Council, which brings together institutional, technology and legal partners such as the African Union Commission, Africa Investor Group, the Great Green Wall of Africa Foundation, AUDA-NEPAD, the Landbanking Group and Mishcon de Reya.

The Natural Capital on African Governments’ Balance Sheets initiative was announced at COP16, currently taking place from Oct. 21 to Nov. 1 in Cali, Colombia.

This initiative will embed nature as an investable asset class within national economic frameworks and investment portfolios to unlock real investments at scale.

Globally, there is a potential $800 billion annual investment opportunity in nature-based solutions, as Africa’s forests, wetlands and biodiversity play a vital role in global decarbonization. Yet, they remain undervalued in traditional economic models, and businesses and investors lack the means to invest with scale into the ecosystems they depend on.

Some of the major barriers include the lack of standardized methodologies for valuing natural capital and the absence of market mechanisms that align business and investor incentives with natural capital preservation and regeneration. It is believed unlocking their value will provide new sources of wealth for Africa by integrating natural resource accounting and developing national standards.

The SMI initiative seeks to accelerate the implementation of the African Union’s Nairobi Declaration (Africa’s Green Investment Deal) launched by African heads of state at the inaugural Africa Climate Summit in Nairobi in September 2023.

“Africa’s natural capital forms the backbone not only of our economies but also of global business models and societies.To protect and expand this value, we must invest at scale in our ecosystems. Through mandate-aligned institutional investor-public partnerships with governments, we can unlock risk- and nature-adjusted returns that drive benefits for people, planet and nature — demonstrating that what’s good for Africa and the world can also create sustainable value for investors.” said Dr. Hubert Danso, co-chair of the SMI Africa Council.
November 4, 2024
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SMI Africa Council Announces Groundbreaking “Natural Capital on African Governments’ Balance Sheets” Initiative at COP16 in Columbia

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Oct 2024, Cali, Colombia – The Sustainable Markets Initiative (SMI) Africa Council (SMIAC) today unveiled the “Natural Capital on African Governments’ Balance Sheets” initiative at COP16. Launched last week at the Commonwealth Heads of Government Meeting in Samoa, this bold SMI initiative aims to align natural capital with national economic frameworks, accelerating the implementation of the African Union’s Nairobi Declaration (Africa’s Green Investment Deal) launched by African Heads of State at the inaugural Africa Climate Summit in Nairobi, September 2023.

The Nairobi Declaration on Climate Change called on global public and private sector stakeholders, to revalue Africa’s Gross Domestic Product (GDP) by fully recognizing the continent’s vast natural capital and ecosystem services. Africa’s forests, wetlands, and biodiversity play a vital role in global decarbonization, yet remain undervalued in traditional economic models. Unlocking their value will provide new sources of wealth for Africa by integrating natural resource accounting and developing national standards.

Natural Capital: Africa’s Economic Opportunity and the World’s Climate Investment Solution

The Natural Capital on African Governments’ Balance Sheets initiative is an institutional investor-public partnership, led by the SMI Africa Council. This initiative will embed nature as an investable asset class within economic frameworks and investment portfolio’s, to unlock real investments at scale, making natural assets a core component of national balance sheets.

“Africa’s natural capital forms the backbone not only of our economies, but also of global business models and societies,” said Dr Hubert Danso, Co-Chair of the SMI Africa Council. “To protect and expand this value, we must invest at scale in our ecosystems. Through mandate-aligned institutional investor-public partnerships with governments, we can unlock risk-and nature-adjusted returns, that drive benefits for people, planet, and nature—demonstrating that what’s good for Africa and the world, can also create sustainable value for investors.”

Despite the global reliance on Africa’s natural resources, current investments are grossly insufficient. Barriers include the lack of standardized methodologies for valuing natural capital and the absence of market mechanisms that align business and investor incentives with natural capital preservation and regeneration.

Closing the $800 Billion Annual Investment Gap

Globally, there is a potential $800 billion annual investment opportunity in nature-based solutions. However, businesses and investors currently lack the means to invest scalably into the ecosystems they depend on.

For decades, the global economy has benefited from Africa’s “Global Commons”—its forests, wetlands, and biodiversity—without fully recognizing their economic value, leaving fiscally challenged African countries to navigate the difficult balance between driving economic growth and safeguarding, while expanding, their natural capital.

The Terra Carta, SMI’s guiding framework, aligns with the Nairobi Declaration’s goals by recognizing nature as the true engine of the global economy.

In the initiative’s foreword, His Majesty King Charles III, founder of the Sustainable Markets Initiative (SMI), stressed, “To build a productive and sustainable future, it is critical that we accelerate and mainstream sustainability into every aspect of our economy. There must be a center of gravity to catalyze this effort and mobilize the resources and incentives required.”

A Global Call for Investment into Africa’s Natural Capital

Commenting on the initiative, H.E. Josefa Leonel Correia Sacko, Commissioner for Agriculture, Rural Development, Blue Economy, and Sustainable Environment at the African Union Commission (AUC), “We welcome the SMI Africa Council’s ‘Nature on the Balance Sheet’ initiative. By embedding nature on the balance sheet, we are making a clear statement: Africa’s natural wealth is a strategic asset for both the continent and the world. This approach not only protects biodiversity but also drives sustainable economic growth and resilience.”

Initiative Focus Areas

The SMI Africa Council’s initiative aims to:

  • Develop a portfolio of high-quality, landscape-level natural capital projects in Africa, using latest technology and new institutional investor-public partnership frameworks and market mechanisms.
  • Support African governments and regional institutions in leveraging natural capital projects to attract private investments.
  • Collaborate with the international community to create enabling conditions for scaling natural capital asset classes globally.

The initiative is designed to assist African governments mobilize private capital at scale, reduce their cost of capital and improve sovereign ratings.

A Global Coalition to Align Growth with Nature

The SMI is building a coalition of investors, philanthropies, private sector actors, project developers, and NGOs, to co-create solutions that bring Africa’s natural capital onto the balance sheet.

At the 2025 Africa Climate Summit, the initiative plans to announce partner commitments from international and domestic investors, businesses and philanthropies, to protect and regenerate African landscapes, ensuring nature conservation, economic growth and portfolio resilience go hand in hand.

Join the Movement

This SMI initiative, which brings together institutional, technology, and legal partners such as the African Union Commission (AUC), Africa Investor (Ai) Group, The Great Green Wall of Africa Foundation, AUDA-NEPAD, The Landbanking Group and Mishcon de Reya LLP, offers a transformational opportunity to position Africa as a central player in the global green investment economy.

If you are interested in joining this effort, please register your interest at africa@sustainable-markets.org.

Media Contact:
For inquiries, please contact:
africa@sustainable-markets.org

About The Sustainable Markets Initiative (SMI) – www.sustainable-markets.org

Established by His Majesty King Charles III and launched at Davos, The Sustainable Markets Initiative (SMI) is the ‘go-to’ CEO-led private sector organisation on the transition to a sustainable future.

About The SMI Africa Council (SMIAC)

The SMI Africa Council (SMIAC) was led by His Majesty King Charles III in recognition of the current realities of the African continent’s 1.3 billion people, and the shared ambition of its 55 countries to establish a common position through the Nairobi Declaration (Africa’s Green Investment Deal) in combatting climate change, biodiversity loss and fulfilling its Nationally Determined Contributions (NDCs) and the Sustainable Development Goals (“SDGs”).

Launched in November 2023 in Nairobi, Kenya, the SMIAC champions scalable collective action by business, finance/investment and governments leaders to benefit  people, planet and nature.

October 28, 2024
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Sustainable Markets Initiative unveils support to Commonwealth Member States at CHOGM

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In support of His Majesty King Charles III’s visits to Australia and Samoa, for the Commonwealth Heads of Government Meeting (CHOGM), SMI launches further support for Commonwealth Member States

  • Pacific Hub launched in Australia to enhance alignment of industry, finance and country efforts to accelerate delivery on global climate and biodiversity targets.
  • Marine Mangrove Sanctuary launched in partnership with SpaceX and Rotary International in Samoa to restore mangrove ecosystems, mitigate sea level rise, increase community connectivity and preserve cultural heritage for future generations.
  • Private Sector Training Programme for government officials extended to enhance public-private partnerships and project delivery in the Commonwealth.
  • SMI’s Impact Accelerator, along with a recommendation to establish High-Level Climate Investment Authorities, launched to provide end-to-end support for governments to develop industry partnerships and investment ready projects aligned with sustainable transition. 
  • The SMI’s Nature-Risk Tool, developed by AECOM, has been made available to all Commonwealth member states to assist them in assessing Nature-risks associated with physical infrastructure and urban planning.
  • The Natural Capital on African Governments’ Balance Sheets Initiative launched to explore making natural capital assets as a core component of national balance sheets.

In the presence of His Majesty King Charles III, as well as leaders from the Commonwealth as part of the Commonwealth Heads of Government Meeting’s Business Forum, the Sustainable Markets Initiative (SMI) has launched several initiatives to further enhance its commitment and support to Commonwealth Members States.

  • Pacific Hub: Connecting SMI’s global CEOs with CEOs and climate leaders in Australia, the SMI launched its Pacific Hub to enhance alignment of industry, finance and country efforts to accelerate delivery on global climate and biodiversity targets.
  • Marine Mangrove Sanctuary: In collaboration with Rotary International and Space X, the SMI is launching a Marine Mangrove Sanctuary in Samoa to restore and maintain the mangrove ecosystem, mitigating sea level rise and preserving cultural heritage.
  • Private Sector Training Programme: SMI introduces a climate-based training programme for government officials in Commonwealth Member States. This programme will support the delivery of climate and biodiversity-related projects and the implementation of Nationally Determined Contributions.
  • Impact Accelerator:  SMI launches its Impact Accelerator for Commonwealth Member States which provides end-to-end support for Governments to develop industry partnerships and investment ready projects aligned with sustainable transition.  The SMI further recommends establishing High-level Climate Investment Authorities within governments to better coordinate and crowd-in private sector support and investment.
  • Nature Risk Tool: SMI’s Nature Risk Tool, developed by AECOM, will now be available to all Commonwealth nations to assess the impact of infrastructure on local biodiversity globally.
  • The Natural Capital on African Governments’ Balance Sheets Initiative was launched as an institutional investor-public partnership, led by the SMI Africa Council. This initiative aims to embed Nature as an investable asset class.

 

Jennifer Jordan-Saifi M.V.O., CEO of the Sustainable Markets Initiative, emphasised the urgency of these initiatives: “It is an honour to be in Samoa for the Commonwealth Heads of Government Meeting (CHOGM). Being welcomed into the community of Nono’a Saleimoa to launch their Mangrove Sanctuary, we saw first-hand how Pacific communities are on the front lines of climate change and biodiversity loss. With future generations in mind, we also saw the passion of community members for restoring harmony with Nature.  The SMI is delighted to bring private sector CEOs together with Commonwealth governments at CHOGM, and through our new Pacific Hub, to accelerate practical, scalable actions that advance a genuinely sustainable future for all.”

Recognizing the importance of biodiversity restoration across the Commonwealth, Dr Hubert Danso, Co-Chair of the SMI Africa Council, highlighted that “Africa’s natural capital forms the backbone not only of our economies, but also of global business models and societies. To protect and expand this value, we must invest at scale in our ecosystems. Through mandate-aligned institutional investor-public partnerships with governments, we can unlock risk and Nature-adjusted returns, that drive benefits for Nature, people and planet.  Through these efforts we aim to demonstrate that what’s good for Africa and the world, can also create sustainable value for investors.”

Pacific Hub

The new SMI Pacific Hub, is the latest addition to the Sustainable Markets Initiative’s regional engagement activities, joining a cohort of five other Hubs and Councils including North America, Africa, China, India, and Greece.  As part of its regional and country approach, the Pacific Hub will provide a forum for CEOs to look more practically at sustainability efforts across industry and finance while exploring how the region’s private sector is actively working with governments to support Nationally Determined Contributions (NDCs) and biodiversity targets in the region.

Marine Mangrove Sanctuary

The Sustainable Markets Initiative announces the Marine Mangrove Sanctuary in collaboration with Rotary International and SpaceX. The sanctuary in Nono’a Saleimoa, Samoa will restore and maintain the mangrove ecosystem to mitigate the onset of sea level rise.  Starlink will enable project leads to record, in real-time, key data points regarding the progress of the project such as: number of mangrove seedlings planted, growth of seedlings, time spent planting and maintaining the site, and general updates from site visits. The project demonstrates the value of remote access connectivity to support underserved and remote communities across the Commonwealth. The SMI’s partnership with Starlink includes a focus on rapidly scaling support for Nature-capital and post-disaster monitoring.

Government Training Programme

The Sustainable Markets Initiative will now offer Commonwealth Member States access to its highly successful Government Training Programme, which has so far had over 800 participants from over 85 countries register worldwide. The programme has convened subject matter experts from across the public and private sectors along with non-governmental organisations to develop climate-based training that can help support government officials (and others) responsible for delivering and developing climate-related projects and the implementation of Nationally Determined Contributions (NDCs).

SMI Impact Accelerator and High-Level Climate Investment Authority

The SMI also offers support through its Impact Accelerator.  The private sector is ready to mobilize capital, however to date there is a limited pipeline of “investment-ready” projects. The Sustainable Markets Initiative strives to fill this gap by offering end-to-end support for project development, industry partnerships and capacity building.  Recognizing the urgency and complexity of public-private partnerships for transition, we strongly recommend that High-Level Climate Investment Authorities (HCIA) be established to offer an empowered and coordinated docking point that is focused on private sector partnerships and capital mobilization.  The SMI has a range of guidance available on how to best establish these HCIAs.

SMI Nature Risk Tool

The Sustainable Markets Initiative has recently launched its SMI Nature Risk Tool and is now offering it to all Commonwealth Member States.  The SMI Nature Risk Tool recognizes that infrastructure development often leads to habitat loss, biodiversity decline, pollution, and increased greenhouse gas emissions. Powered by AECOM, and using datasets from the Taskforce for Nature-related Financial Disclosures (TNFD), the SMI Nature Risk Tool enables infrastructure investors and promoters to analyse any piece of land globally, providing expert-reviewed descriptions of the location’s habitat and biomes early in the site selection process.

October 28, 2024
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Dr. Hubert Danso Champions Institutional Investor Action for Africa’s Role in the $10 Trillion Global Green Industrial Economy at Cornell-OFR Climate Finance Conference

By Events, Featured

New York, NY –25 October 2024

Africa investor (Ai) announced today that Dr. Hubert Danso, CEO and Chairman of Africa investor, delivered a pivotal address at the esteemed Cornell-OFR Global Climate Finance and Risks Conference. He presented transformative strategies for scaling institutional investment to mobilize private capital for climate transition in emerging markets and developing countries (EMDCs).

Dr. Danso spoke on the panel Investors and Global Climate Financing, where he underscored Africa’s indispensable role as a green technologies manufacturing hub, vital for achieving global net-zero goals and accelerating the $10 trillion per annum green industrial economy.

Distinguished Speakers at the Conference

The conference featured prominent speakers, including Dr. Hubert Danso, Janet Yellen (Secretary of the US Treasury), Mark Carney (Co-Chair of GFANZ and Vice Chair of Brookfield Asset Management), Andrew Karolyi (Dean, Cornell SC Johnson College of Business), Richard Cantor (Vice Chairman, Moody’s Investors Service), Johan Rockström (Director of the Potsdam Institute for Climate Impact Research), and Alissa Kleinnijenhuis (Professor, Cornell University, Imperial College London), among other global authorities from academia, the public sector, and finance.
Africa’s Strategic Role in the Global Green Transition

Dr. Danso highlighted Africa’s unparalleled strategic assets, including:

  • 40% of critical climate minerals essential for green industrialization.
  • 50% of global natural capital critical for global decarbonization.
  • Renewable energy potential exceeding that of the EU and US combined.

He also pointed to Africa’s demographic dividend, with its youth projected to comprise half the global workforce by the century’s end, and the continent’s $4.8 trillion carbon credit market potential by 2050. Despite these advantages, Africa receives only 2% of global private investment in renewables, facing a $3 trillion financing gap for its Nationally Determined Contributions (NDCs) over the next six years.

“There is no single pathway to net-zero without exponentially increasing institutional investor capital allocations to Africa,” Dr. Danso stated.

Universal Owner Solutions to Scale Institutional Investor-Public Partnerships (IIPPs)

Dr. Danso proposed a series of solutions to address the critical market failure in private capital mobilization (PCM) by Multilateral Development Banks (MDBs), which currently mobilize only 20-38 cents of private capital per dollar of development finance, far below the G20’s $10 target.

Key approaches outlined include:

  1. Bankable Offtakes – Creating demand coalitions in sectors such as green hydrogen, steel, cement, and sustainable aviation fuel to de-risk large-scale Greentech projects in Africa.
  2. Policy Frameworks – Mainstreaming initiatives like the Commonwealth Heads of Government Climate Investment Authorities to make development investable, rather than developmental.
  3. Risk Data Platforms – Democratize AI-driven platforms like GEMs3.0 to enfranchise green, risk-adjusted investment portfolios.
  4. Programmatic Pipelines – Partnering with governments to turn Africa’s $3 trillion NDC commitments into investable opportunities.
  5. New Asset Classes – Transforming African green industrial infrastructure, natural capital, and green industrial cities into investable asset classes to create programmatic allocations aligned with institutional mandates.

A Call for Bold Global Leadership
Dr. Danso urged G7 and G20 governments to act as “climate investment statesmen” by championing innovative investment models and increasing government borrowing to co-invest in sustainable projects. He emphasized the need for MDBs to prioritize de-risking private capital’s participation and called for incentivized private-to-private de-risking mechanisms to complement traditional MDB efforts.

“Appropriately incentivized institutional investors, as universal owners, have the capacity to close 90% of Africa’s financing gap. The urgency to align capital with climate priorities has never been greater,” he affirmed.

A Collaborative Path Forward
Dr. Danso concluded with a powerful message: Africa’s role in the global green industrial economy is essential, not optional. The continent’s unique resources, demographic strengths, and untapped markets present an extraordinary opportunity for institutional investors to achieve competitive returns and enhance portfolio resiliency while advancing global decarbonization efforts for the benefit of people, planet, and nature.

About the Conference
The Cornell-OFR Global Climate Finance and Risks Conference, organized by the Cornell SC Johnson College of Business, US Treasury’s Office of Financial Research, and the Cornell Atkinson Center for Sustainability, convened global experts to explore innovative solutions for scaling climate finance and mitigating systemic risks.
ENDS

October 25, 2024
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GEMs Consortium Issues More Granular Data; Critics Seek More Transparency

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The Global Emerging Markets Risk Database (GEMs) Consortium Oct. 15 reported on country-by-country loan default and recovery rates for the first time, but the Consortium has still not met the key transparency demand: making the database accessible.

The new data was called insufficient by critics in the private and nonprofit sector who say that issuance of more detailed information is necessary to boost lending to Emerging Market and Developing Economies (EMDEs).

GEMs said it is issuing “increasingly granular statistical publications,” but its future plans remain unclear.

The latest information came in two reports, released by the European Investment Bank, which administers the GEMs database. (See press release.) The GEMs data comes from 26 multilateral development banks (MDBs) and development finance institutions (DFIs) that pool their data using a harmonized template. The GEMs database is used by the 26 institutions, whose representatives jointly make decisions about its transparency.

Transparency Levels Debated

The lingering issue is how much data should be made available.

There is widespread agreement that more information would benefit EMDEs by providing investors “greater insights into credit risks in emerging markets, thereby allowing them to better guide their asset allocations,” as the GEMs press release puts it.

But the “piecemeal approach” was sharply criticized by Hubert Danso, Chief Executive Officer and Chairman of African Investor, an institutional investment holding platform based in South Africa.

“While today’s reports, conveniently timed to deflect criticism during the World Bank Annual Meetings, provide fragmented insights using GEMs data, they unfortunately miss the mark,” Danso told Eye on Global Transparency. The Bank and the IMF meetings will be held Oct. 21-26 in Washington.

Similarly, Karen Mathiasen, project director with the Center for Global Development, a Washington-based think tank, said that “for GEMS data to be of real use to the private it needs to include breakdowns by country and sector.”

The push from more detailed transparency has arisen from many quarters, but perhaps most significantly from the Group of 20 developed countries. Transforming GEMs into a free-standing entity “by 2024” was proposed. A 2022 report to the G20, called the Capital Adequacy Framework (CAF) review, said GEMs should “publish more granular statistics and analysis of the data showing credit performance for sovereign and private sectors by sector, countries or country groups, and regions.” The report further prescribed that GEMs should “share anonymized statistics with private investors and ratings agencies.” In addition, it said, GEMs should “provide risk analytics, charging fees as needed.” A new G20 action plan for the MDBs is being developed and could include more specific goals.

The Development Committee of the World Bank Group, in a wide-ranging statement issued April 19, 2024, stressed that. private capital mobilization “will be instrumental in meeting development financing needs.” Among other steps to this end, the Development Committee “applauded the publication of additional data from the Global Emerging Markets Risk (GEMs) database and statistics on the WBG’s default and recovery rates and look forward to further disaggregation, including by country and sector.”

The GEMs consortium, while providing reports with gradually increasing levels of granularity last year and this, has been circumspect about its long-term goals. In the Oct. 15 press release, Román Escolano, Group Chief Risk Officer, European Investment Bank, said, “The updated publications, with greater disaggregation and analysis, address feedback from our key stakeholders, and GEMs plans to continue publishing such statistics in a timely manner.”

Learning about future plans is complicated because the Consortium holds closed meetings and does not release any documents about them, including minutes.

The EIB denied EYE’s request for access to the minutes of the GEMs key decision-making body, the General Assembly. The EIB said disclosure of the minutes would “seriously undermine” its work and subject officials to “external pressure.” (See EYE article.) EYE appealed the denial but the EIB has yet to issue a decision. EYE also appealed the EIB’s decision to keep secret key parts of 2019 GEMs data-sharing agreement between the EIB and ILX Management, a Dutch investment company. This appeal is also pending. (See EYE update.)

Oct. 15 Report Provides More Data

The GEMs Consortium said that both of the new reports would benefit investors and that they show that “emerging market investments should be within the risk appetite of a broad range of investors,” in the words of Federico Galizia, Vice President, Risk and Finance, International Finance Corporation.

As summarized by the EIB:

The first publication covers the credit performance of lending to private and public counterparts. The average annual default rate of lending to private entities at 3.56% is broadly aligned with many non-investment grade firms in advanced economies, and the average recovery rate of 72.2% is higher than many global benchmarks. Although the GEMs statistics reflect the unique experience of MDBs and DFIs, these results provide valuable information on the investment risk in EMDEs, an area characterized by a lack of available credit risk data.

The second publication provides default rates and – for the first time – recovery rates for sovereign and sovereign-guaranteed lending based on an expanded range of 40 years of data. Results shows an average annual default rate of 1.06% and an average recovery rate of 94.9% and complement the GEMs statistics on private and public counterparts to provide a comprehensive view on EMDEs credit risks.

Danso Sees “Fiduciary Negligence’

Danso said, “This piecemeal approach distracts from the core issue: the urgent need for the full implementation of the GEMs2.0 directive, as mandated by the G20 for rollout in 2024.”

“Anything less,” he continued, “postpones the structural transparency required to properly price risks in emerging markets and developing countries (EMDCs), further hindering scaled efforts to crowd in private capital.”

According to Danso, “The absence of a fully operational GEMs2.0 database (which is a no cost reform for MDBs and the GEMs Secretariat), costs developing countries over $15.6 billion annually in avoidable cost of capital premiums and lost opportunities.”

Without this database, he said, “the current data landscape offers limited practical value for pricing risks and making informed investment decisions” and “EMDCs are likely to endure another year of inflated capital costs, just as official development assistance (ODA) declines and fiscal constraints deepen.”

Danso said, “The reluctance within MDBs to fully embrace their mandated responsibility to crowd-in private capital reflects not just a breach of mandate, but also erodes trust with their sovereign members and clients. Such fiduciary negligence by both the MDBs and the GEMs Secretariat compromises global financial stability and sustainable development—precisely when their most vulnerable and fiscally constrained clients need it most.”

October 24, 2024
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The magic pony of private finance fails to fund the global green transition

By News

By now it’s a well-established pattern. A bright-eyed new World Bank president, the current one being the former Mastercard CEO Ajay Banga, comes in promising to leverage judicious injections of public money to unlock the vast reserves of private sector cash itching to invest in infrastructure in developing countries. The plan is hailed as a bold new market-led approach to helping poor countries get rich. And then it doesn’t really happen. This pattern stretches back through David Malpass, the bank’s president from 2019-2023, Jim Yong Kim (2012-2019), Robert Zoellick (2007-2012) and ultimately to the 1990s when James Wolfensohn, one of the bank’s most influential presidents, sought to tap the gushing rivers of capital in the post-cold war surge in globalisation. The challenge of getting private finance to build infrastructure is even now more acute because of the green transition to renewable energy and low-carbon technologies.

Traditionally generous donor countries — the UK, France, Norway — are cutting aid budgets. Instead, they often concentrate on “development finance institutions” (DFIs) such as the UK’s British International Investment company. By far the largest DFI is the World Bank’s International Finance Corporation (IFC). The DFIs lend or take equity stakes in businesses in developing countries and aim to “crowd in” private capital. The results have been consistently disappointing. A forthcoming book by the former World Bank economist James Leigland on the rise and fall of public-private partnerships (PPP) notes that private contributions to developing-country infrastructure projects peaked at a low level in 2012 — with only 10 per cent going to the lowest-income nations — and have fallen since. They have had relative success in some sectors such as renewable energy generation but had difficulties in others.

An independent expert group on the multilateral development banks commissioned by the G20 leading economies suggests achieving $240bn in private capital mobilisation by 2030. The latest figure is just $71.1bn, of which again only 10 per cent went to the poorest countries. The DFIs aim to leverage substantial multiples of the money they put in, but in practice the ratio of private to public capital has struggled to rise above 1:1. Institutional investors like pension funds are notable by their almost total absence. Whereas Australian and Canadian pension funds are active in infrastructure finance in advanced economies, for developing countries they have historically had a pitiful share in total investments of less than 1 per cent.

 

Why? Undoubtedly there are some fixes that could be tried. Avinash Persaud, special adviser at the Inter-American Development Bank (IDB) who worked on the Bridgetown Initiative to increase capital flows to developing countries, argues for creating a facility to reduce currency risk for investments. Investment managers say there is a deeper problem — that DFIs at heart act like private investors, not catalysts for other investments, and their bureaucratic processes deter rather than attract other funds. Infrastructure investment is intrinsically tricky. It’s typically long-term and involves political as well as commercial risk, especially with essential public utilities like power and water, and hence requires detailed information and precise regulation in the recipient country.

The aid transparency initiative Publish What You Fund has released a report arguing for granulated disclosure of data at a project level to inform private investment decisions, which it says the IFC and DFIs have been slow to do. Institutional investors such as AllianzGI and Africa Investor back the PWYF conclusions.

Hubert Danso, chief executive of Africa Investor Group, says: “A stable legal and regulatory framework and better data are far more important than multilateral development banks, which are often better at crowding out private capital than crowding it in.”

He and PWYF reject the IFC’s argument that publishing such data threatens commercial confidentiality. Development banks and their shareholders have a long-standing tendency to judge themselves on how much money they get out of the door rather than what it does when it arrives. For DFIs, that is a particularly unfortunate mentality since they are supposed to be opening the door for others. But even more fundamentally, official lenders and governments should be more realistic about what private finance can achieve in infrastructure.

It’s somewhat ironic that the UK in particular has been so keen to push PPP in developing countries, since Britain’s own experiences in the area have not exactly been joyful. A decades-long experiment, the Private Finance Initiative, had extremely mixed results and was terminated by the Conservative government in 2018. Writing contracts that created incentives to invest and genuinely shifted risk to private investors proved to be very difficult. A summit held in London this week to encourage private investors to fund British infrastructure anew was clouded by questions about lack of clarity and the UK’s business climate, with the government feebly resorting to the tired old mantra about tearing up bureaucratic red tape.

It’s admirable in principle to encourage private investors into infrastructure in lower-income as well as higher-income economies. But continually announcing bold initiatives and talking in the hundreds of billions of dollars without creating appropriate incentives will only breed cynicism. If the world is to achieve its targets for the green transition, there is likely to be no magic alternative to having public money doing a lot of the work. Pretending otherwise does few favours to anyone, least of all developing countries themselves.

 
October 24, 2024
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Global Investors Back African NDCs as Platform to Build a World-Leading Green Technologies Manufacturing Hub

By Events, News

New York, September 24, 2024
Global institutional investors, representing over $50 trillion in assets as universal owners, have committed to supporting Africa’s Nationally Determined Contributions (NDCs) by assisting governments in transforming them into investable, bankable projects.

At the African NDC Institutional Investment Summit, held during New York Climate Week alongside the UN General Assembly, institutional investors, governments, and philanthropies explored Africa’s $3-7 trillion NDC opportunities. The goal is to position the continent as an investable global green technologies manufacturing hub and a central player in the $10 trillion per annum green industrial economy and value chains.

The Summit, hosted by The Sustainable Markets Initiative (SMI)and Africa investor (Ai), was themed: “Aligning Private Capital Mobilization at Scale with Africa’s NDCs, the Nairobi Declaration, and the Sustainable Development Goals (SDGs).”

At the 37th African Union Heads of State Summit, African leaders stressed the urgent need to mobilize private capital to finance Africa’s $3 trillion NDC climate and sustainable development projects by 2030. With multilateral concessional loans addressing only 10% of the continent’s private financing gap, the Summit reinforced the critical role of institutional investors in realizing Africa’s green transition and advancing the goals of the Nairobi Declaration through scaled private capital mobilization to green risk-adjusted portfolios.

In response, the SMI Africa Council (SMIAC), in collaboration with Africa investor (Ai), launched the Investable Asset Classes Working Group initiative, to establish African green industrial infrastructure as a globally competitive investable asset class. This initiative brings together the world’s largest institutional investors, philanthropies, investment consultants, and corporate demand coalitions to attract domestic and global private capital at scale, co-create bankable NDC investment programs, and unlock the full potential of African natural capital on government balance sheets.

The African NDC Institutional Investment Summit showcased strategies for private capital mobilization through Institutional Investor-Public Partnerships (IIPPs) and innovative blended investments designed to decarbonize industries and build Africa’s green industrial base. Investors and leaders agreed that Africa is uniquely positioned, through IIPPs, to capitalize on the growing global green industrial economy, given its vast renewable energy resources and commitment to sustainable development.

Summit Partners included the CFA New York Asset Owners Council, the African Union Development Agency (AUDA) Continental Business Network, the Economic Commission for Africa (ECA), the NDC Partnership, and the African Green Infrastructure Investment Bank (AfGIIB).

Key Summit Outcomes focused on:
•⁠ ⁠Establishing African green industrial infrastructure and natural capital as a globally competitive investable asset class.
•⁠ ⁠Co-creating bankable NDC investment programs and risk-adjusted portfolios aligned with the Nairobi Declaration.
•⁠ ⁠Promoting data democratization to transform the MDB’s GEMs2.0 risk database into GEMs3.0 as an asset allocation at-scale platform.
•⁠ ⁠Aligning and mobilizing philanthropic, private, and public capital at scale and speed through IIPPs and innovative blended investments.
•⁠ ⁠Expanding Africa’s participation in the $10 trillion per annum global green industrial economy through long-duration bankable offtakes, offering sustainable and climate-adjusted returns for investors.

Speaking on the Summit, Dr Hubert Danso, Chair, Africa investor and Co-Chair SMI Africa Council, explained, “This historic African NDC’s Institutional Investment Summit of the world largest universal owners, the African Union, African governments, philanthropies, and the private sector, squarely responds to African Union Heads of State call for institutional investor-public partnerships through the continents revised NDCs, to accelerate Africa’s just energy transformation and decarbonize the world at industrial for the benefit of people, planet and nature”.

The Summit reaffirmed that Institutional Investor-Public Partnerships (IIPPs) and long-duration bankable offtake agreements are the investable pathway for global investors and philanthropies to support Africa’s just energy transformation and establish African green industrial infrastructure as a globally competitive investable asset class through its NDCs. These partnerships support the African Union’s ambitions, as outlined in the Nairobi Declaration, to position Africa as a world leader in green technologies manufacturing and value chains for the $10 trillion per annum and growing global green industrial economy.

September 27, 2024
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African NDC Investment Award Winners Unveiled at UN New York Climate Week

By Events, Featured, News, Press Release

24 September 2024, NDC Awards Media: Dubai, Johannesburg, Nairobi, Lagos, Washington, Brussels, Beijing

The African NDC Investment Awards Secretariat proudly announced today the recognition of African governments and business leaders at the Africa Investor (Ai) NDC Investment Awards, held on September 24th, 2024, during New York Climate Week at the African NDC Institutional Investment Summit.

These timely NDC Investment Awards, sponsored by the African Green Infrastructure Investment Bank (AfGIIB), were established to celebrate outstanding achievements across the primary sectors of Nationally Determined Contributions (NDCs). The awards honor governments, investors, development partners, private sector entities, philanthropies, and Presidential Climate Investment Champions who are driving investments and enhancing the readiness and ambition of Africa’s NDC projects, which collectively require between $3 trillion and $7 trillion by 2030.

The awards ceremony convened dignitaries and numerous leaders from public, private, and philanthropic investment sectors across Africa and around the globe, demonstrating an unwavering commitment to addressing Africa’s NDC investment opportunities at the scale required.

Commenting on the Ai NDC Investment Awards announcement, Dr. Hubert Danso, Chairman of the Africa Investor Group and Chair of the NDC Awards Adjudication Panel, stated:

“Africa Investor (Ai) is proud to leverage its global investment platform to showcase and recognize the efforts of African governments, investors, development partners, the private sector, philanthropies, and our esteemed Presidential Climate Investment Champions. This growing community of leaders is pivotal to mobilizing the necessary $3 trillion in green investments for our NDCs by 2030, propelling Africa towards an equitable and investable energy transition which benefits people, planet, and nature.
We congratulate all shortlisted and winning candidates for their inspiring climate investment leadership.”

Now in their third year, these awards were initially launched at the Commonwealth Heads of Government Meeting in Kigali in 2022 and have since gained prominence, with presentations at COP27 in Egypt and COP28 in Dubai.

The 2024 African NDC Investment Awards honored several distinguished leaders:

Presidential Green Industrialization Investment Statesman of the Year
• H.E. Dr. William Samoei Ruto, President of the Republic of Kenya

Presidential Green Infrastructure Investment Statesman of the Year
• H.E. Mohamed Ould Ghazouani, President of the Islamic Republic of Mauritania

Presidential Just Transition Investment Statesman of the Year
• H.E. Bola Tinubu, President of the Federal Republic of Nigeria

Presidential Carbon Investment Initiative Statesman of the Year
• H.E. Denis Sassou Nguesso, President of the Republic of the Congo

Presidential Transport Investment Statesman of the Year
• H.E. Joao Lourenco, President of the Republic of Angola

Presidential Water Investment Statesman of the Year
• H.E. Prithvirajsing Roopun, President of the Republic of Mauritius

Presidential Agriculture Investment Statesman of the Year
• H.E. Samia Suluhu Hassan, President of the Republic of Tanzania

Presidential Energy Investment Statesman of the Year
• H.E. Julius Maada Bio, President of the Republic of Sierra Leone

In addition to honoring the Presidential Champions, the Awards also recognized outstanding NDC projects and initiatives, with winners in the following categories:

  • Best Waste NDC Investment Initiative of the Year: Cape Town Waste Management Strategy, City of Cape Town’s Directorate of Urban Management
  • Best Energy NDC Investment of the Year: Microsoft and G42 AI Kenya Renewables Investment Programme
  • Best Transport NDC Investment Initiative of the Year: The Lobito Corridor Investment Promotion Authority
  • Best Forestry NDC Investment Initiative of the Year: Republic of Congo Forest Management Program, Ministry of Forest Economy of the Republic of Congo
  • Best Financeable NDC City Investment Initiative of the Year: Casablanca Urban Green Spaces Project, Casablanca Urban Agency
  • Best GreenTech NDC Investment Initiative of the Year: M-KOPA Solar, International Finance Corporation (IFC)
  • Best Agriculture NDC Investment Initiative of the Year: Low Carbon Transformation of the Rwandan Tea Processing Sector, Green Climate Fund (GCF)
  • Best Health NDC Investment Initiative of the Year: Nigerian Climate-Resilient Health Initiative, World Health Organization (WHO)
  • Best Water NDC Investment Initiative of the Year: Resilient Water Accelerator (RWA)
  • Best Investable NDC Adaptation Investment Initiative of the Year: The Africa Adaptation Acceleration Program, Global Center on Adaptation and the African Development Bank Group
  • Best Bankable Donor NDC Investment Initiative of the Year: USTDA and ILN Strategic Climate Finance Mobilization Partnership
  • Best Blended Investment NDC Investment Initiative of the Year: Afreximbank Climate Finance Program
  • Best Youth NDC Investment Initiative of the Year: Green Jobs Platform, Jacob’s Ladder Africa
  • Best Natural Capital NDC Investment Initiative of the Year: Congo Basin Natural Capital Accounting Project, Climate Investment Funds (CIF)
  • Best Green Industrialization NDC Investment Initiative of the Year: The Africa Green Industrialization Initiative (AGII), African Union Commission and COP28 Presidency

The Awards successfully reinforced Africa’s dedication to advancing green industrialization, unlocking the continent’s vast climate and investment potential, and inspiring bold leadership and collaboration on the path to sustainability.

Ends

 

September 25, 2024
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Dr. Hubert Danso Addresses Columbia University Sustainability Summit on Blended Finance and Institutional Investment for Emerging Markets

By News, Press Release

New York, NY, 25 September – Africa investor (Ai) announced today that Dr. Hubert Danso, CEO and Chairman of Africa investor, participated in Columbia University’s prestigious SIRI Blended Finance Conference.

Dr. Danso contributed to a high-level fireside discussion moderated by Merit Janow, Dean and Professor of Practice at Columbia University’s School of International and Public Affairs (SIPA). The distinguished panel also included Sabine Mauderer, First Deputy Governor of the Deutsche Bundesbank and Chair of the Network for Greening the Financial System (NGFS).
The discussion explored critical themes, including the creation of enabling financial regulatory and political environments to globally and locally scale blended finance, and strategies to mitigate and manage foreign currency risks in higher-risk markets.

Speaking from the perspective of institutional investors as universal owners, Dr. Danso stressed the need for robust frameworks to accelerate and scale blended investment solutions, including risk data enhancement and risk re-characterization education. He highlighted the alignment between institutional mandates and opportunities to channel private capital into emerging markets and developing countries (EMDCs), which often face disproportionate and unqualified risk perceptions.

Dr. Danso advocated for scaling Institutional Investor-Public Partnerships (IIPPs) as a mechanism to unlock and redirect allocations from the $300 trillion pool of global institutional assets. He underscored Africa’s significant potential, particularly its natural capital, vast reserves of critical climate minerals, and the emergence of well-managed investment platforms and programmatic pathways that facilitate participation in the rapidly growing $10 trillion per annum global green industrial economy.

In his remarks, Dr. Danso called on G7 governments to move beyond reliance on dwindling development assistance budgets and adopt bold strategies that prioritize increased government borrowing for sustainable industrial investments in EMDCs. He proposed a reclassification of government spending into two distinct categories—consumption/maintenance and investment—and advocated for proactive investment strategies championed by G7 and G20 nations.

“By deliberately increasing government debt in the short term, focused on investment rather than consumption, G7 governments can unleash positive economic multipliers, boost global GDP, accelerate decarbonization, and realize market-appropriate risk and climate-adjusted returns,” Dr. Danso stated.

He further emphasized that such an approach could unlock $23 trillion in climate industrial investment opportunities in EMDCs, driving sustainable growth across the Global South while contributing to non-inflationary global economic expansion and decarbonization efforts.

The SIRI Blended Finance Conference remains a premier platform for global thought leaders to discuss and develop innovative financial solutions for sustainable development, solidifying its role as a catalyst for transformative action.

ENDS

September 25, 2024
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African Union Climate Investment Leadership Recognised by Africa Investor at African NDC Investment Awards

By Events, Featured, News

24 September 2024, NDC Awards Media

New York, Addis Ababa, Dubai, Johannesburg, Nairobi, Lagos, Washington, Brussels, Beijing – Africa Investor (Ai) Group, a leading international institutional investment group, announced today that the African Union’s climate investment leadership was recognized with two major green industrialization award wins at the prestigious Africa Investor (Ai) NDC Investment Awards. The awards were presented during the African NDC Institutional Investment Summit & Awards, held alongside the 79th UN General Assembly and New York Climate Week.

The 2024 African Green Industrialization Investment Initiative of the Year was awarded to the African Union Commission and the COP28 Presidency for their groundbreaking African Green Industrialization Initiative, launched at COP28. The award was received by H.E. Josefa Leonel Correia Sacko, Commissioner for Agriculture, Rural Development, Blue Economy, and Sustainable Environment (ARBE) at the African Union Commission.

The 2024 Presidential Green Industrialization Investment Statesman of the Year honor was bestowed upon H.E. President William Ruto of Kenya for his tireless and impactful leadership during the Africa Climate Summit. Both awards recognize exemplary leadership in promoting and engaging the private sector to support the Nairobi Declaration – Africa’s Green Investment Deal.

These first-of-their-kind African NDC Investment Awards, sponsored by the African Green Infrastructure Investment Bank (AfGIIB), were established to recognize the achievements of governments, institutions, and Heads of State in enhancing the investment readiness of Africa’s NDC (Nationally Determined Contributions) projects, which require $3 trillion in investment by 2030.

Launched at the Commonwealth Heads of Government Meeting in Kigali in June 2022, the inaugural NDC Investment Awards were presented at COP27 in Egypt in November 2022. The 2023 NDC Investment Awards were profiled at the Africa Climate Summit in Nairobi, with shortlisted projects announced during New York Climate Week and the 78th Session of the UN General Assembly. The second edition of the awards was presented at COP28 in Dubai.

Commenting on the two award winners, Dr. Hubert Danso, Chairman of Africa Investor Group and Chair of the NDC Awards Adjudication Panel, said: “Africa Investor (Ai) is proud to leverage its global investment platform to showcase and recognize Africa’s NDCs public, private, philanthropic, and Presidential Climate Investment Champions. We congratulate H.E. Josefa Leonel Correia Sacko, the COP28 Presidency and President William Ruto for their tireless and successful green industrialization leadership and climate investment statesmanship, positioning Africa as a globally competitive and investable green technologies manufacturing hub.”

Ends

 

September 24, 2024
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African NDC Investment Summit and Awards Conclude Successfully at Climate Week

By Events, Press Release

24 September 2024, NDC Awards Media

New York, Addis Ababa, Dubai, Johannesburg, Nairobi, Lagos, Washington, Brussels, Beijing – Africa Investor (Ai) Group, the continent’s leading institutional investment platform, announced today the successful conclusion of the African NDC Institutional Investment Summit and Awards, held in association with the Sustainable Markets Initiative (SMI) Africa Council. Under the theme “Aligning Private Capital Mobilization at Scale with Africa’s NDCs, the Nairobi Declaration, and the Sustainable Development Goals (SDGs),” the event concluded on a high note.

The Summit was hosted by the CFA Society New York Asset Owners Council in collaboration with key partners, including the Economic Commission for Africa (ECA), the African Union Development Agency (AUDA) Continental Business Network, the SMI Africa Council, the NDC Partnership, and the African Green Infrastructure Investment Bank (AfGIIB). It brought together African and global leaders to discuss strategies for scaling up private capital to support Africa’s Nationally Determined Contributions (NDCs) and green development projects.

At the 37th African Union (AU) Heads of State Summit, African leaders highlighted the urgency of mobilizing private capital to finance Africa’s $3 trillion in climate and sustainable development projects by 2030. The leaders recognized that concessional loans from Multilateral Development Banks (MDBs) would address only 10% of the continent’s private financing gap. The Heads of State reaffirmed their commitment to collaborating with the global institutional investment community to achieve the objectives of the Nairobi Declaration.

In response to this call, the SMI Africa Council (SMIAC), in partnership with Africa Investor, launched an initiative to position African green industrial infrastructure and nature as globally competitive investable asset classes. This initiative aims to mobilize private and philanthropic capital, create investable development opportunities, co-create bankable NDC investment programs, and achieve the Nairobi Declaration’s goals through Institutional Investor-Public Partnerships (IIPPs) and blended investments.

The Summit convened leaders from across Africa and around the globe, representing over $50 trillion in assets under management and advisement. Discussions focused on private capital mobilization strategies, IIPP opportunities, and showcasing Africa’s potential as a significant player in the $10 trillion per annum global green industrial economy, all while achieving risk and climate-adjusted returns for public, private, and philanthropic investors.

The Summit also showcased the work of the SMI Africa Council’s Investable Asset Classes Working Group, which has been instrumental in positioning African green industrial infrastructure as a globally competitive investable asset class and co-creating bankable NDC projects. These initiatives will help accelerate the Nairobi Declaration’s private capital mobilization targets and support global decarbonization efforts through IIPPs and blended investment solutions.

Commenting on the Summit and Awards, Dr. Hubert Danso, Chairman of Africa Investor (Ai) and Chair of the NDC Investment Awards Adjudication panel, said: “Africa’s NDCs are at a pivotal moment as countries prepare their five-year updates, due in February 2025.

This summit presented a powerful opportunity for governments, institutional investors, and philanthropies to come together and form impactful institutional investor-public partnerships. By making African NDCs investable, we can mobilize private capital at the speed and scale required to unlock the continent’s $3-7 trillion NDC investment opportunities and transform Africa’s green industrial future.

We extend our heartfelt congratulations to all the nominees and winners of the African NDC Investment Awards. Your projects are a beacon of hope and action, demonstrating what is possible when ambition meets commitment, inspiring us all to raise ambition and accelerate our efforts in building a sustainable Africa and a thriving world for the benefit of people, planet, and nature.”

The Summit culminated in the African NDC Investment Awards, which recognize the achievements of governments, institutions, and individuals advancing investment readiness for Africa’s NDC projects, which require over $3 trillion in investment by 2030. Now in their third year, these awards were initially launched at the Commonwealth Heads of Government Meeting in Kigali in 2022 and have since gained prominence, with awards presented at COP27 in Egypt and COP28 in Dubai.

The 2024 African NDC Investment Awards honored several distinguished leaders:

Presidential Green Industrialization Investment Statesman of the Year

  • H.E. Dr. William Samoei Ruto, President of the Republic of Kenya

Presidential Green Infrastructure Investment Statesman of the Year

  • H.E. Mohamed Ould Ghazouani, President of the Islamic Republic of Mauritania

Presidential Just Transition Investment Statesman of the Year

  • H.E. Bola Tinubu, President of the Federal Republic of Nigeria

Presidential Carbon Investment Initiative Statesman of the Year

  • H.E. Denis Sassou Nguesso, President of the Republic of the Congo

Presidential Transport Investment Statesman of the Year

  • H.E. Joao Lourenco, President of the Republic of Angola

Presidential Water Investment Statesman of the Year

  • H.E. Prithvirajsing Roopun, President of the Republic of Mauritius

Presidential Agriculture Investment Statesman of the Year

  • H.E. Samia Suluhu Hassan, President of the Republic of Tanzania

Presidential Energy Investment Statesman of the Year

  • H.E. Julius Maada Bio, President of the Republic of Sierra Leone

The Awards also recognized outstanding NDC projects and initiatives, with winners in the following categories:

  • Best Waste NDC Investment Initiative of the Year: Cape Town Waste Management Strategy, City of Cape Town’s Directorate of Urban Management
  • Best Energy NDC Investment of the Year: Microsoft and G42 AI Kenya Renewables Investment Programme
  • Best Transport NDC Investment Initiative of the Year: The Lobito Corridor Investment Promotion Authority
  • Best Forestry NDC Investment Initiative of the Year: Republic of Congo Forest Management Program, Ministry of Forest Economy of the Republic of Congo
  • Best Financeable NDC City Investment Initiative of the Year: Casablanca Urban Green Spaces Project, Casablanca Urban Agency
  • Best GreenTech NDC Investment Initiative of the Year: M-KOPA Solar, International Finance Corporation (IFC)
  • Best Agriculture NDC Investment Initiative of the Year: Low Carbon Transformation of the Rwandan Tea Processing Sector, Green Climate Fund (GCF)
  • Best Health NDC Investment Initiative of the Year: Nigerian Climate-Resilient Health Initiative, World Health Organization (WHO)
  • Best Water NDC Investment Initiative of the Year: Resilient Water Accelerator (RWA)
  • Best Investable NDC Adaptation Investment Initiative of the Year: The Africa Adaptation Acceleration Program, Global Center on Adaptation and the African Development Bank Group
  • Best Bankable Donor NDC Investment Initiative of the Year: USTDA and ILN Strategic Climate Finance Mobilization Partnership
  • Best Blended Investment NDC Investment Initiative of the Year: Afreximbank Climate Finance Program
  • Best Youth NDC Investment Initiative of the Year: Green Jobs Platform, Jacob’s Ladder Africa
  • Best Natural Capital NDC Investment Initiative of the Year: Congo Basin Natural Capital Accounting Project, Climate Investment Funds (CIF)
  • Best Green Industrialization NDC Investment Initiative of the Year: The Africa Green Industrialization Initiative (AGII), African Union Commission and COP28 Presidency

The Summit and Awards successfully reinforced Africa’s commitment to advancing green industrialization and unlocking the continent’s vast climate and investment potential.

Ends

    
African NDC Investment Awards Shortlist Announced by Africa investor
African Union Climate Investment Leadership Recognised by Africa Investor at African NDC Investment Awards
 
September 24, 2024
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SMI Africa Council to Host GEMs 3.0 Investor and Philanthropy Consultation at New York Climate Week

By Events, News

The SMI Africa Council (SMIAC) will host a high-level, invitation-only consultation for institutional investors and philanthropists during New York Climate Week, focused on GEMs 3.0—a groundbreaking data and analytics platform initiative aimed at scaling investments in Africa, emerging markets, and developing economies (EMDEs). This closed-door event is designed to explore new approaches to leveraging Global Emerging Markets Risk (GEMs) data to unlock critical capital flows into these regions.

GEMs 3.0 is an institutional investor-led platform supported by SMIAC, with the mission of transforming how risk data in emerging markets is used to drive investments. By incorporating investor insights and engagement, GEMs 3.0 aims to support the implementation of major global initiatives, including the G20 Capital Adequacy Framework (CAF), the COP27 Presidency, the New Financial Pact Summit, the Bridgetown Initiative, and the Africa Climate Summit. Additionally, it aligns with the $150 trillion Institutional Investor Consortium’s COP28 Call-to-Action, which urges multilateral development banks (MDBs) and development finance institutions (DFIs) to form institutional investor-public partnerships. The ultimate goal is to democratize access to GEMs data analytics and significantly boost private capital mobilization to bridge the climate and SDG investment gap in Africa and EMDEs.

One of the key pillars of GEMs 3.0 is its commitment to engage directly with African Heads of State and MDB partners, creating pathways for more substantial investments. Building on GEMs 2.0, the platform integrates feedback from leading institutional investors and rating agencies to evolve into a powerful asset allocation tool. This will enable governments, issuers, and investors to collaborate on de-risking investments, encouraging larger capital allocations while meeting SDG and Paris Accord objectives.

GEMs 3.0 is positioned to become a leading data and risk analytics platform for investors, helping create blended finance structures to scale private investments in areas such as climate adaptation, mitigation, and SDG-aligned initiatives. By offering tools that analyze Probability of Default (PD) and Loss Given Default (LGD), the platform will help investors refine risk perceptions, leading to more accurate pricing and informed decision-making in emerging markets.

The New York Climate Week consultation will provide an update on GEMs 3.0’s progress and its strategic roadmap toward COP30 in Brazil, and will cover ecosystem consultations around the World Bank Annual Meetings in Washington, COP29 in Baku, and upcoming global summits like the G7 Summit in Canada and the G20 Summit in South Africa.

For more information and updates on GEMs 3.0, visit www.gems3.ai

September 23, 2024
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