Last Updated:
27 Feb 2020

Principles of MDBs’ Strategy for Crowding-in Private Sector Finance for Growth and Sustainable Development

Achieving the objectives set forth in the 2030 Sustainable Development Agenda calls for stepping up cooperation among all partners; enhancing domestic revenue mobilization; improving public spending efficiency; mobilizing and catalyzing private finance; and enhancing the role of the private sector across a broad spectrum of development activities including agriculture, climate change, education, health, finance, infrastructure, logistics, manufacturing and services. The MDBs, within their respective institutional mandates and lending capacities, play an important role in helping their borrowing member countries implement the 2030 Agenda in coordination with other relevant parties including the private sector. MDBs catalytic role in crowding-in the private sector by supporting reforms and reducing risks, and hence the cost, of private capital is among the relevant contributions to implementing this Agenda.

Because of the demand-driven nature of the MDBs’ work, client countries are ultimately responsible for engaging the MDBs in catalyzing private investment. Each of the MDBs therefore works to tailor its approach to the specific opportunities in each of its member countries, taking into consideration their own development plans, specific governance and legal frameworks, political and social realities, and institutional, financial market and sectoral characteristics. The Principles on Crowding-in Private Sector Finance provide a common framework among MDBs to increase levels of private investment in support of their development objectives.