Letter from the MB of the Fund Manager
The development finance industry evolved during 2018. It took on a more prominent role in achieving the Sustainable Development Goals, several governments committed more funds to development finance and climate change and inequality are now generally seen as two of the world’s most pressing issues.
To solve them, we will need significant investments. It will take an additional $2.5 trillion per year to meet the SDGs and an additional $13.5 trillion to implement the COP21 Paris climate accord. FMO is committed to using its own balance sheet to mobilise more from commercial investors and, crucially, leverage public funds.
The Dutch government is one of the pioneering forces mobilising the private sector. Since 2002, in close co-operation with FMO, it has established funds that support private sector investments in areas such as infrastructure, energy and small entrepreneurs. These funds bridge a financing gap key to achieving the SDGs: they give young but promising businesses in emerging economies, which commercial investors find too risky, a chance to flourish.
The Infrastructure Development Fund, one of these funds, had a profitable 2018 and made nine general investments and two project development investments. By the end of the year the fund reached a crossroads. Our original decade-long mandate ended, and the government entrusted us with an extension of another 10 years and a EUR 100 million top up. During the year we prepared for this new period by adapting the fund’s strategy to focus more broadly on agribusiness, infrastructure and climate change mitigation and adaptation. To reflect these changes, IDF will be known as Building Prospects from 2019.
In addition, the Minister for Foreign Trade and Development Cooperation in 2018 launched a policy that calls on the private sector to play a more prominent and innovative role in achieving the SDGs. FMO will contribute to this by participating in a Dutch state-owned company that will help the Dutch private sector to invest outside the Netherlands.
Developments such as these fill us with optimism that we can eventually tackle climate change and achieve equality, especially when the courage and clout of governments help to tip the scales in the right direction. We would like to thank all our stakeholders for their continuous support, including our clients and investors, the Dutch Ministries of Finance and Foreign Affairs, the NGOs that help us to improve and, most of all, our colleagues for giving their best every day.
Fatoumata Bouaré, Chief Risk & Finance Officer
Linda Broekhuizen, Chief Investment Officer
Peter van Mierlo, Chief Executive Officer