Institutional investors: time to get involved in development and blended finance
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The original version of this blog appeared in top1000funds.
The investment requirements for global sustainable development are huge. State budgets are already stretched in most emerging markets and developing countries (EMDE), with tax bases weakened and public debt piling up.
Stagnating private finance in developing countries
The pandemic has exacerbated weaknesses also on the private sector side. External private finance tends to be highly volatile in EMDEs. Foreign direct investment has severely slowed down. Portfolio investments play an insignificant role in low-income countries, where capital markets are less developed. Even the controversial Chinese banks’ lending has retracted.
The World Bank’s Private Participation in Infrastructure (PPI) Database reports stagnating volumes of infrastructure projects with private participation in EMDEs at around $100 billion per year, or about 0.3 per cent of GDP. Furthermore, they are mainly concentrated in a small number of middle-income countries like China, India, Brazil, Vietnam or Russia. Low-income economies only see a small and even shrinking fraction, according to the G20’s Global Infrastructure Hub.
Mobilizing “blended finance”
, in addition to the traditional operations such as grants, loans and advisory services. The “mobilization” of private capital for development by MDBs has, so far, been small (about an annual 0.2% of GDP). Only a few billions reach the poorest countries, of which little goes into health, education and other social infrastructure. Loans and guarantees are the dominant instruments while fund vehicles and equity stakes appear under-used.
There is no shortage of opinions on what governments, DFIs and investors should do to improve the flow of money. One concept has become much talked about in recent years: “blended finance”—the use of public or philanthropic finance to increase private sector investment in development. Scope, metrics and definitions vary widely. Blended finance vehicles are often complex and not easy to scale up. Importantly, the involvement of asset owners is still meager.
Obstacles for institutional investors
Many investors are indeed keen to broaden the set of investment opportunities in growth markets. There are various hurdles and challenges, including:
- The (actual and perceived) political, regulatory and micro risks
- Regulations, fiduciary duty, and investor mandates
- Investor capacity and costs
- Specific constraints for less liquid investments like transport or water/sewage projects
How to match long-term investing with development needs? Our comprehensive report, Financing Development: Private Capital Mobilization and Institutional Investors, provides key analysis and recommendations for both policy makers and investors. In fact, institutional investors have moved into emerging markets since the 1990, mostly by buying securities of large, listed companies (such as financials, utilities or telecoms) or government bonds. More investors are now gaining exposure to EMDEs via private equity/debt or infrastructure funds. Some large asset owners are undertaking direct investments e.g., in renewable energy.
In short, investors can build on experience gained in middle income countries. There is scope for progress also in less developed economies when the conditions are right and opportunities arise. The main burden is with governments. More and better action is possible, with the DFIs here to help.
Creating long-term investment opportunities
- Investment environment: The less developed a country, the more public institutions— domestic and international—must be up to the task.
- Investable assets: Clarity on the underlying, long-term funding will facilitate financing and investing.
- MDBs: —for reasons of experience, risk mitigation, local knowledge and political clout.
- Co-investment vehicles: Equity co-investment vehicles for riskier countries and sectors are still underdeveloped. Both commercial and blended finance vehicles (e.g., with certain limited credit enhancements or insurances) targeting investors of different risk appetite could be expanded.
- Domestic investors:
- Sustainability and impact investing: Responsible investor boards are keen to raise their ESG and SDG profiles, opening a new door. Such demand could be increasingly satisfied in EMDEs. Green and social bonds will gain momentum also in developing countries. We see tentative steps towards investing in low-income countries via impact funds, e.g., in water, housing and other community projects.
Expectations need be realistic on the potential of institutional investors, particularly in less-developed countries. Policy makers, DFIs and investors should not just focus on a few headline policy vehicles. They need to better utilize the full spectrum of investment routes: impact, blended, and especially commercial. Even small re-allocations of capital can have a big impact on the ground.
Disclaimer: The content of this blog does not necessarily reflect the views of the World Bank Group, its Board of Executive Directors, staff or the governments it represents. The World Bank Group does not guarantee the accuracy of the data, findings, or analysis in this post.
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This blog is managed by the Infrastructure Finance, PPPs & Guarantees Group of the World Bank. Learn more about our work here.
Join the Conversation
SUBJECT: COVID-19 AND OTHER DISEASE BURDEN ABATEMENT
DearSir/ Madam,
I would like to draw your kind attention to the adversities of underprivileged people and want of health care facilities in poor and developing countries. The underprivileged people are suffering from various common diseases every year. Recently Coronavirus prevailed as pandemic form. Proper awareness programs with the supply of low-cost health care related commodities in poor communities may protect these people from many diseases.
I developed some cost-effective products by self-supported research works for diseases burden abatement and for the development of economical, social, educational conditions of poor people by creating employment facilities. It has been demonstrated that our products are effective and cheaper than the existing health care commdities and safe drinking water production equipment. Many rural people and residents of urban slums have no ability for purchasing costly essential health care items and effective safe drinking water production plants. So they are suffering from many diseases. Millions of rural population facing scarcity of safe drinking water due to arsenic contamination. Besides these, almost every year devastating flood, cyclone, drought etc. strike in Bangladesh. The poor people and farmers suffer from hunger, scarcity of drinking water, many diseases, want of shelters erc.
But due to financial support we are not able to manufacturer and supply these cheaper diseases preventing, epidemic situation control health care and other essential commodities and cheaper modern water purification plants. Because we have no UN and Government organisations, donor agencies of any country for financial support to manufacturer and supply these health care items to the poor. Some local kind persons supported financially for erection our modern water purification plants and health care items supply in rural villages.
We are very interested to work as partner or associate with dedicated organisations like yours.
I, therefore, hope that you would be gracious enough to take initiative on behalf of your Organization for support or to be partner for manufacturing essential cost-effective health care and hygiene related commodities to reduce disease burden of poor people.
Some of my products and services are discussed briefly in the following
article for your sympathetic consideration.
Thanking you,
Sincerely yours,
Shyamal Chowdhury,
Chemist and Researcher
Care Chemicals.
Contact Address:
Shyamal Chowdhury
46, Buddhist Temple Road,
Ranajoy’s House (3nd Floor),
Nandan Kanan, Chittagong
Email: sssupervision@yahoo.com
Mobile: +8801874440503
--------------------------------------------------------
. . ARTICLE
-------------------------
INITIATIVE FOR DISEASES BURDEN ABATEMENT
Shyamal Chowdhury
Email: sssupervision@yahoo.com
Cell: +8801874440503
ABSTRACT: In poor and developing countries the underprivileged people are suffering from various common diseases, such as diarrhea, cholera, dysentery, typhoid, malaria, Chikungunya, dengue, fever and cold, jaundice etc. Many people, especially children, die of these diseases every year in the rural villages, slums of urban areas and hilly regions of Asia, Africa and some other countries. For curing these diseases many drugs and antibiotics are used without qualified doctors' prescriptions and tests. Recently Coronavirus prevailed as pandemic form. Proper awareness programs with the supply of low-cost health care related commodities in poor communities may protect these people from these diseases.
BACKGROUND: Tropical and sub-tropical countries of Asia and Africa and some other countries have the climatic environment to culture various types of the bacteria or virus of many diseases and these may be spread worldwide. Poor people are ignorant of health care, origin and mode of action of these diseases. Consequently, many people, specially children, die of many diseases and for unhygienic conditions of these communities.
We have taken initiative to reduce disease burden of poor community by low-cost modern technologies. We started research works with a view to save the lives and developed some cost-effective health care related commodities.
METHODOLOGY: To reduce the disease burden programs of supplying grant, loan, medicine with health camp, campaign etc. are arranged by many organizations.
Besides these, use of some cost-effective health care related commodities is essential to reach the goal of Global Health Program. So, by self supported research work, we developed some health care related low-cost commodities such as hygienic hand-wash, chlorinated disinfectant made of WHO approved raw material selected for Coronavirus and other germs based diseases control, Outdoor mosquito and larvae killing spray and indoor mosquito repellents, prepared by nontoxic, safe and natural ingredients. To reduce water borne diseases in rural settings arsenic filter compound (patented) for arsenic mitigation was invented. To save the environment arsenic waste management system was developed. To detect arsenic and for monitoring arsenic mitigation process independently by the rural users easy, efficient, stable and cost-effective arsenic test kit had been developed. For facing the scarcity of safe drinking water durning disaster and in hilly areas, this water plant can also be used for surface water purification.
RESULT AND DISCUSSION: Supplying and using the
cost-effectivet hand-wash (liquid) and chlorinated disinfectant from beginning period of Covid-19 epidemic in hospitals, Banks, shopping malls, offices etc. In several districts of Bangladesh satisfactory results have been achieved.
Mosquito borne diseases are prevalent in more than 100 countries and mosquitoes kill more than 700,000 people each year. Some chemicals insecticides have been used for the purpose of mosquito repellency or killing, however they are extremely harmful for human beings. Use of long term chemical insecticides resistance is evolved that render the chemicals ineffective. Such resistance poses a serious threat to mosquito control worldwide. So, plant base ingredients are now encouraging for safe life and environment. The ingredients of our outdoor mosquito and larvae killing spray and indoor mosquito repellent vaporizer are non-toxic plant origin products. It has been demonstrated that adult mosquitoes and larvae had been killed instantly by applying the outdoor spray in some highly mosquitoes nuisance areas of Chittagong City Corporation in Bangladesh,
The cost-effective, stable and efficient arsenic water filter compound (patented) is safe which after setting in filter composite, mitigated arsenic of shallow tube-well of Sitakundu, Chittagong, Bangladesh, from 0.1735 ppm to 0.0013 ppm (Tested in Bangladesh University of Engineering and Technology, BUET). Recently, after pre treatment for continuous process, this filter compound mitigated arsenic of deep tube-well of BRAK-WASH water sample of Satkhira, Bangladesh, from 0.082 ppm to less than 0.001 ppm (Tested in Japanese environmental laboratory, Asia Arsenic Network). All the highly accurate tests were performed by very costly instrument Atomic Absorption Spectrophotometer.
By the same arsenic water purification filter composite, water of flood, rivers, reserved ponds and hilly springs can be purified by using sodium hypochlorite and coagulant.
CONCLUSION: For the abatement of disease burden of underprivileged communities, assurance of supply of cost-effective health care related commodities is an important and ethical task of the members of developed and literate societies. To achieve the objectives of Global Health Program, United Nations, World Bank, Donor Agencies, NGOs, CGSs etc. have to cooperate for manufacturing these types of modern low-cost essential health care products and supplying to the poor.
------------------
SUBJECT:COVID-19 AND OTHER DISEASE BURDEN ABATEMENT
Dear Sir,
I would like to draw your kind attention to the adversities of underprivileged people and want of health care facilities.
In poor and developing countries the underprivileged people are suffering from various common diseases, such as diarrhea, cholera, dysentery, typhoid, malaria, Chikungunya, dengue, fever and cold, jaundice etc.
Recently Coronavirus prevailed as pandemic form. Proper awareness programs with the supply of low-cost health care related commodities in poor communities may protect these people from many diseases.
To reduce disease burden of poor people and preventing Coronavirus in all communities, I have formulated some cost-effective health care commodities.
I, therefore, hope that you would be gracious enough to take initiative on behalf of your Organization for large scae manufacturing the essential cost-effective health care and hygiene related commodities to reduce disease burden of poor people.
Some of my products and services are discussed briefly in the following
article for your sympathetic consideration.
Thanking you,
Sincerely yours,
Shyamal Chowdhury,
Chemist and partner
Care Chemicals.
Contact Address:
Shyamal Chowdhury
46, Buddhist Temple Road,
Ranajoy’s House (3nd Floor),
Nandan Kanan, Chittagong
Email: sssupervision@yahoo.com
Mobile: +8801874440503
------------------------------------------------------- ARTICLE
--------------------------------------------------------
INITIATIVE FOR DISEASES BURDEN ABATEMENT
Shyamal Chowdhury
Email: sssupervision@yahoo.com
Cell: +8801874440503
ABSTRACT: In poor and developing countries the underprivileged people are suffering from various common diseases, such as diarrhea, cholera, dysentery, typhoid, malaria, Chikungunya, dengue, fever and cold, jaundice etc. Many people, especially children, die of these diseases every year in the rural villages, slums of urban areas and hilly regions of Asia, Africa and some other countries. For curing these diseases many drugs and antibiotics are used without qualified doctors' prescriptions and tests. Recently Coronavirus prevailed as pandemic form. Proper awareness programs with the supply of low-cost health care related commodities in poor communities may protect these people from these diseases.
BACKGROUND: Tropical and sub-tropical countries of Asia and Africa and some other countries have the climatic environment to culture various types of the bacteria or virus of many diseases and these may be spread worldwide. Poor people are ignorant of health care, origin and mode of action of these diseases. Consequently, many people, specially children, die of many diseases and for unhygienic conditions of these communities.
We have taken initiative to reduce disease burden of poor community by low-cost modern technologies. We started research works with a view to save the lives and developed some cost-effective health care related commodities.
METHODOLOGY: To reduce the disease burden programs of supplying grant, loan, medicine with health camp, campaign etc. are arranged by many organizations.
Besides these, use of some cost-effective health care related commodities is essential to reach the goal of Global Health Program. So, by self supported research work, we developed some health care related low-cost commodities such as hygienic hand-wash, chlorinated disinfectant made of WHO approved raw material selected for Coronavirus and other germs based diseases control, Outdoor mosquito and larvae killing spray and indoor mosquito repellents, prepared by nontoxic, safe and natural ingredients. To reduce water borne diseases in rural settings arsenic filter compound (patented) for arsenic mitigation was invented. To save the environment arsenic waste management system was developed. To detect arsenic and for monitoring arsenic mitigation process independently by the rural users easy, efficient, stable and cost-effective arsenic test kit had been developed. For facing the scarcity of safe drinking water durning disaster and in hilly areas, this water plant can also be used for surface water purification.
RESULT AND DISCUSSION: Supplying and using the
cost-effectivet hand-wash (liquid) and chlorinated disinfectant from beginning period of Covid-19 epidemic in hospitals, Banks, shopping malls, offices etc. of several districts of Bangladesh satisfactory results have been achieved.
Mosquito borne diseases are prevalent in more than 100 countries and mosquitoes kill more than 700,000 people each year. Some chemicals insecticides have been used for the purpose of mosquito repellency or killing, however they are extremely harmful for human beings. Use of long term chemical insecticides resistance is evolved that render the chemicals ineffective. Such resistance poses a serious threat to mosquito control worldwide. So, plant base ingredients are now encouraging for safe life and environment. The ingredients of our outdoor mosquito and larvae killing spray and indoor mosquito repellent vaporizer are non-toxic plant origin products. It has been demonstrated that adult mosquitoes and larvae had been killed instantly by applying the outdoor spray in some highly mosquitoes nuisance areas of Chittagong City Corporation in Bangladesh,
The cost-effective, stable and efficient arsenic water filter compound (patented) is safe which after setting in filter composite, mitigated arsenic of shallow tube-well of Sitakundu, Chittagong, Bangladesh, from 0.1735 ppm to 0.0013 ppm (Tested in Bangladesh University of Engineering and Technology, BUET). Recently, after pre treatment for continuous process, this filter compound mitigated arsenic of deep tube-well of BRAK-WASH water sample of Satkhira, Bangladesh, from 0.082 ppm to less than 0.001 ppm (Tested in Japanese environmental laboratory, Asia Arsenic Network). All the highly accurate tests were performed by very costly instrument Atomic Absorption Spectrophotometer.
By the same arsenic water purification filter composite, water of flood, rivers, reserved ponds and hilly springs can be purified by using sodium hypochlorite and coagulant.
CONCLUSION: For the abatement of disease burden of underprivileged communities, assurance of supply of cost-effective health care related commodities is an important and ethical task of the members of developed and literate societies. To achieve the objectives of Global Health Program, United Nations, World Bank, Donor Agencies, NGOs, CGSs etc. have to cooperate for manufacturing these types of modern low-cost essential health care products and supplying to the poor.
------------------
There are private interests in EMDEs with plans that require the participation of the MDB to create the climat to attract private external funds.
The North East Jamaica Project prepared for Global Energy Nutrition Initiative is one such. This project will serve as a prototype for inclusive sustainable development in the tropics within the 1.5 degree celsius target. It must be realized that eight to ten billion people must achieve equity within the temperature, environmental and social goals set by the IPCC for the SDG.