Global poverty is increasingly concentrated in fragile and conflict-affected settings. A vibrant private sector that creates jobs and opportunities is essential in these environments, to help alleviate poverty, inequality and instability.
These regions struggle to attract commercial investment because opportunities are typically overshadowed by high financial risk, and weak or fragmented institutions. Development finance institutions (DFIs) recognise that they have a key role in enabling and supporting private investment and entrepreneurship in fragile and conflict-affected settings.
To share ideas and improve collaboration between development finance institutions in these regions, a group of DFIs (including CDC) and academic institutions established the DFI Fragility Forum. At the end of March 2021, the Forum met for the third time with over 25 DFIs represented – though this year’s conference was held online due to the coronavirus pandemic.
The DFI Fragility Forums have highlighted the scope for DFIs working together. Through collaboration, DFIs can bring their collective capacity and experience to bear, to help shape environments in which the private sector can invest, whilst mitigating financial risks. DFIs can also provide the funding and advisory required by private investors, and mobilise other financiers that would not act on their own.
This year’s Forum covered:
- The lessons learned in a number of countries where greater DFI collaboration has been piloted
- How to develop upstream collaboration among DFIs in order to improve the environment for business in fragile and conflict-affected situations, and build stronger investment pipelines; and,
- The challenges and opportunities in these situations for the energy sector, with particular attention to distributed renewable energy
The DFI community remains committed to exploring avenues for greater collaboration, and we look forward to working with our partners on the DFI Fragility Forum in 2022.