18.12.20-bfldcs-report-2020-Infographic

Blended Finance in the
Least Developed Countries 2020
The least developed countries (LDCs) are the furthest from achieving
the Sustainable Development Goals (SDGs). They are also likely to be
hit the hardest by the COVID-19 crisis. Blended finance can play a key
role to support LDCs in mobilising resources for the medium-to-long
term recovery from the COVID-19 crisis.
RECENT
TRENDS
2012–2018
Private finance mobilised in LDCs, compared to other country groupings
25
Total
$85 billion
Aggregated volume (2012–2018)
6%
USD billion
20
15
10
5
0
Total
$68 billion
Total
$41 billion
Total
$13 billion
2012 2013
2014 2015
2016 2017
2018
Total
$0.2 billion
UMICs LMICs Unallocated LDCs Other LICs
20%
Only 6% of
private finance 41%
was mobilised
in LDCs
33%
UMICs LMICs
Unallocated LDCs
Other LICs
LDCs continue to receive the lowest, although increasing in volume, share of only 6% of private finance mobilised by
official development finance interventions. Between 2012 and 2018, approximately USD 13.4 billion was mobilised in LDCs.
This compares with over USD 84 billion (41%) in UMICs and USD 68 billion (33%) in LMICs.
Amounts mobilised from the private sector
in LDCs: 2012-2018
0.75
USD billion
1.45 1.68 1.91 1.89 1.90
3.81
2012 2013 2014 2015 2016 2017 2018
In 2018 private finance mobilised in LDCs
more than doubled compared to the previous
year – from USD 1.9 billion in 2017 to USD 3.8
billion in 2018.
16
14
12
10
8
6
4
2
0
Blended finance funds and facilities: AUM by country grouping (2017)
$7 billion
4
6
$4 billion
2
2
$15 billion
LDCs Other LICs
LMICs UMICs
Facilities Structured funds Flat funds
$11 billion
1
2
Blended finance CIVs invested USD 7.6 billion in LDCs (20% of USD 38 billion), of which
commercial investors provided only USD 340 million. More commercial finance was
mobilised in structured rather than flat funds, particularly those structured as private equity.
2
4
9
8
USD billion

Average 2017–2018
2% 1%
12% 0.1%
34%
18%
34%
Eastern Africa Western Africa
South-eastern Asia
Southern Asia Middle Africa
Caribbean Southern Africa
USD million
1600
1400
1200
1000
800
600
400
200
0
Regional allocation of private finance mobilised in LDCs
Total
$4.1 billion
Total
$3.6 billion
Total
$2.1 billion
Total
$1.7 billion
Total
$1.6 billion
Eastern Africa Western Africa South-eastern Asia Middle Africa Southern Asia
2012 2013 2014 2015 2016 2017 2018
Total
$0.1 billion
Caribbean
Over the 2012-2018 period, 45 out of the 47 LDCs received private finance mobilised by official development finance at least once. Compared to
the 2019 report, two additional LDCs - Lesotho and Central African Republic - received private finance mobilised.
Top ten LDCs in terms of average volume of private finance mobilised
In 2017-2018, the top five LDC recipients of private finance mobilised were:
Uganda, Myanmar, Bangladesh, Benin and Mauritania.
400
Average 2017–2018
300
USD million
200
100
0
1
Uganda
2
Myanmar
3
Bangladesh
4
Benin
5
Mauritania
6
Cambodia
7
Togo
8
Zambia
9
Senegal
10
Madagascar
Private finance mobilised in LDCs by leveraging mechanism
Share of private finance mobilised
80
60
40
20
0
62%
46%
Guarantees
24%
14%
Direct investment in
companies and SPVs
12% 11%
7% 7%
5% 8%
1% 3%
Syndicated loans Credit lines Simple co-financing Shares in CIVs
Average 2015–2016 Average 2017–2018
Guarantees mobilised the largest amounts of private finance by official development finance interventions in LDCs, followed by direct investment
in companies and SPVs and syndicated loans. Mobilisation through direct investment in companies and SPVs (i.e. equity investments) increased
by over 10% compared to previous years.

Private finance mobilised in LDCs by sector
Average 2017–2018, USD million
Banking and
financial
services; 672
Energy; 796
Other; 236
Tourism; 0
Business and other services; 12
Water supply and sanitation; 13
Other social infrastructure; 29
Trade policies and regulations; 35
Cross-cutting; 39
Health and population; 55
Unallocated and other sectors; 56
General environment protection; 63
Government and civil society; 70
Communications; 211
Industry, mining,
construction; 337
Transport and storage; 242
Agriculture, forestry, fishing; 226
The role of blended finance in responding to the COVID-19 crisis response and recovery:
key areas of focus for building forward better
Attract investment
in line with national
SDG priorities
Get people back
to work at decent,
sustainable jobs
Focus on small
and medium-sized
enterprises
Systematically
support women
and girls
Support health
systems
Target sectors critical
for inclusive, resilient
and sustainable
development
An Action Agenda to harness the potential of blended finance for the LDCs