Unlock our hidden Gems: Costs to Developing Countries of MDBs not democratising investor access to GEMS risk Database


Africa investor’s call to action for Heads of State at Emmanuel Macron’s #NewGlobalFinancingPact #summit2023 in Paris this week:  

Democratize investor access to the Global Emerging Markets Risk database (GEMs), which costs Emerging Market and Developing Country (EMDC) borrowers over $15bn each year in extra costs and lost opportunities and to support the GEMs3.0 investor proposal:  The GEMs database, owned by a consortium of Multilateral Development Banks (MDBs), is likely the best global database for default and loss for EMDC borrowers.

MDBs crucially have the potential to mobilize private finance at capital, which are critical to tap into, if we are to close the African more competitive pricing and investment at levels many times $3trn climate finance gap. Achieving this will require more capital higher than in the past. Only with your support and your institutions to be deployed annually to 2030, than has been delivered over the working collaboratively not competitively, will we achieve the scale last decade. This kind of unprecedented acceleration in both the of private capital mobilization that is required to ‘close the SDG and climate financing gap’. Time is running out.

One of the most important ways for your institutions to contribute to broadening the investor base is by improving the information available about investment conditions in EMDC’s. The lack of information is raising the cost of capital, in many cases making desperately needed investments unaffordable. Your have valuable data that must be transparently shared.

In that respect, we urge Heads of State as the Governing Plenipotentiary Sovereign MDB shareholders who hold a privileged position to be able to influence the mandates and operating models of their MDBs to:

  • Significantly accelerate, to the end of 2023, the timeline for making the relevant information from the joint MDB Global Emerging Markets credit database (GEMs2.0 initiative) available to private investors. It should be clear, as well, that the information is useful only if all MDBs contribute data to the fullest extent, including from their historical record.
  • Support a new financial pact for GEMs2.0, to further develop into GEMS3.0, as a wider user and investor engagement platform to complement, expand and broaden the development of data sets to mobilize private resources, to increase the effectiveness of GEMs2.0 as an asset allocation tool, by integrating a broader investor base, with a clear understanding of the opportunities of investing at scale in EMDC’s alongside MDBs with the joint mission to develop datasets to increase allocation decisions to close the climate and SDG financing gap in EMDC’s.

Read the full report here.

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