DFIs in Europe post record new investments in 2023
EDFI member DFIs add €9.5 billion in total new equity stakes and financing.
Brussels, 8 February 2024
Fifteen Europe-based development finance institutions in 2023 recorded their strongest year for total level of combined commitments1. Together, DFis channeled €9.5 billion in capital to private sector clients in emerging and developing economies who would otherwise not have accessed capital for impact-rich business activity2.
Despite a lumpy macro-economic landscape and geopolitical unease, EDFI members increased new investments by 10%, bringing them beyond the pre-Covid commitment level.
Africa remains top DFI investment destination
Africa once again took in the largest share of total new commitments, at 40.0 per cent of 2023 financing and valued at €3.8 billion, up 12.0 per cent from 2022.
Gender finance marches forward
DFIs continued to narrow the void between impact and finance, especially for gender finance, which climbed year on year by 38.0 per cent, reaching €2.3 billion.
Climate finance up third straight year
DFI climate finance portfolio swelled during the past three years, up 260.0 per cent since the start of 2020. The rise came as sales of climate-focused mutual funds fell 75.0% during the past two calendar years, says a Financial Times report, due to high interest rate spikes, poor fund performance and political challenges.
Focus remains on SMEs, low-income & least-developed countries
European DFIs in 2023 remained on impact priorities, including support for SMEs and enabling investments in low-income or least-developed countries (LICs/LDCs). Combined LIC and LDC3 activity totaled €1.2 billion, up 5.0 per cent, while SME commitments dipped by 3.0 per cent compared with 2022, reaching €2.6 billion in 2023.
Full report set for Q3 2024
The data released today offers a first snapshot of EDFI member activity for 2023. A more detailed annual report, including an in-depth look at EDFI member institutions’ activities and impact during 2022 is scheduled for release in third quarter of this year. The report will add data on the commitments from blended finance and co-financing facilities managed by DFIs and the EDFI Management Company on behalf of donor partners, private co-finance mobilisation.
See: Full release with graphs (.pdf)
- EDFI member DFIs add €9.5 billion in total new equity stakes and financing
- Robust 38 percent bump in gender equality commitments, 17 per cent rise for climate
- Record-high new investments further boost private firms in low-, middle-income countries
Footnotes:
1 The data on new investments in 2023 reflect EDFI member institutions’ combined new investment commitments from their own balance sheets in the form of debt, equity and guarantees to private sector enterprises and financial institutions in emerging and developing economies.
2 Given the different mandates and specialisations within EDFI members, the experience of particular institutions in the past year varied. Note that strong aggregate results do not change what remains a challenging investment environment in many countries.
3 Refers to least developed countries (LDCs) according to the OECD Development Assistance Committee list fiscal year 2023.
Notes to editor:
About the data: Data show European DFIs’ own investment commitments in 2023. It excludes the financial resources EDFI member institutions mobilised in 2023 from private impact investors and the commitments of blended finance, technical assistance and advisory services for clients.
About EDFI: The Association of European Development Finance Institutions, or EDFI, was established in 1992 to support and promote the work of bilateral Development Finance Institutions (DFIs). With a combined portfolio of €51.0 billion, including more than €15 billion of climate finance, EDFI’s 15 member institutions share a vision of a world where the private sector offers people in low- and middle-income countries opportunities for decent work and improved lives, and where private investment flows are aligned with the Sustainable Development Goals and the Paris Climate Agreement. EDFI’s mission is to promote the joint interests of its members, inform policy, and drive innovation in industry standards.
EDFI membership: BII (UK), BIO (Belgium), Cofides (Spain), DEG (Germany), Finnfund (Finland), FMO (The Netherlands), IFU (Denmark), Norfund (Norway), OeEB (Austria), Proparco (France), SIFEM (Switzerland), Simest and CDP Development Finance (Italy), SOFID (Portugal), Swedfund (Sweden).
