Investment Services

Green Investment Services

Helping developing countries access finance remains a foremost priority, especially after the ratification of the Paris Agreement where countries have committed to implement their lower carbon development targets, in addition to meeting their Sustainable Development Goals. The total amount of capital required for countries to achieve the 2-degree stabilization target is $93 trillion by 2050. Public finance will not be sufficient to fill this need. There are three primary reasons for this Green Investment gap. First, projects are often not bankable and they do not match the risk and reward appetite of investors. Second, instruments to mobilize green finance do not offer the required scale needed to attract finance. Third, developing countries routinely lack the institutional capacity to manage funds in line with the needs and expectations of international investors.

 

Theory of Change

GGGI’s Green Investment Services (GIS) support countries by developing bankable projects, national financing vehicles and risk reducing instruments to bridge the gap between finance and projects.

Green Investment Services (GIS) delivers its work by:

  • Developing a pipeline of bankable green growth projects;
  • Performing the role of an “arranger”, that is, designing and structuring commercially viable projects that attract appropriate finance, and getting them financed;
  • Structuring financial solutions that blend public/ concessional finance and commercial/private finance in order to reduce risk and consequently help position public and private parties with commercially viable project structures;
  • Designing innovative financial mechanisms often in the form of funds and instruments that reduce and possibly mitigate risks and overcome other barriers specific to green growth;
  • Establishing dedicated vehicles capable of blending international and domestic sources of capital for financing green growth;
  • Prioritizing projects and instruments that are impactful and are catalytic, i.e. they mitigate risk sufficiently to pave the way for private investment in the sector;
  • Integrating social and environmental considerations into projects, valuing and monetizing natural assets where possible, and
  • Advising partner countries on the development of their investment plans.