HomeRegional NewsAfricaHow blended finance can change Africa’s development story

How blended finance can change Africa’s development story

Finance is one of the challenges that keep project developers awake at night, but also government-led programmes.

Last week, a lead specialist from the DBSA’s Product Innovation Unit, Jonathan First, spoke with ESI Africa about the role of blended finance in overcoming the enormous infrastructure development shortfall in Africa.

The DBSA lead specialist explained that blended finance is the strategic use of concessional finance provided by government to crowd in or catalyse private sector funding that results in infrastructure development and has developmental impact.

Blended finance must play a more meaningful role

In the interview, First quotes the prediction that in 2020 funds under management – such as pension funds – will exceed 1.2 trillion dollars in Africa. However, he stresses that almost none of this is currently being used to finance infrastructure or is being invested in Africa.

In comparison, this figure is close to $111 trillion in assets under management globally at low interest rates.

The question is how to access these funds to finance development on the African continent, which according to First can be achieved through blended finance.

What two factors need to be addressed to enable the funding of energy, water, education and healthcare projects? Watch the interview to find out.

Nicolette Pombo-van Zyl
As the Editor of ESI Africa, my passion is on sustainability and placing African countries on the international stage. I take a keen interest in the trends shaping the power & water utility market along with the projects and local innovations making headline news. Watch my short weekly video on our YouTube channel ESIAfricaTV and speak with me on what has your attention.