De-risking and Blending
According to the Global Infrastructure Hub, the estimated global infrastructure funding gap stands at USD 15 trillion until 2040, which is expected to widen over the medium term. Even though the COVID-19 crisis is dampening the investment appetite of investors in the short-term, there is a growing interest among the investors to invest in infrastructure assets as they are looking to diversify their portfolios.
Investment opportunities within the infrastructure sector can meet these expectations in terms of deal size and financial returns. However, multiple challenges in terms of de-risking still need to be addressed to multiply the investments. The MDBs along with other DFIs play an important role as catalysts for investments, as the investors often appreciate their expertise and ‘political clout’ in new investments that are perceived risky.
Blended Concessional Finance co-investments help challenging infrastructure projects achieve financial closure through de-risking solutions and by helping rebalance risk-return expectations of pioneering projects. Successes of initial pilot projects can be replicated with lesser or no blended finance co-investments.
Joachim von Amsberg, Vice President, Strategy and Policy, AIIB (Moderator)
Hans Peter Lankes, VP Economics & Private Sector Development, IFC
Sedef Yavuz-Noyan, Head of PPP Dept, Strategy & Budget Office, Presidency of Turkish Republic
Nancy Lee, Senior Policy Fellow, Center for Global Development
Fathima Hussain, Project Finance Head for Europe, Standard Chartered Bank
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