OVERVIEW

At the 2022 G20 Bali Summit, the G20 leaders unanimously ratified the G20 Bali Leaders’ Declaration acknowledging the need for the Global Blended Finance Alliance (GBFA) to serve as a global community of support to accelerate investment in climate action and sustainable development. The ambition of the initiative was to address the huge financing gap through blended finance structures for climate actions and achieving the SDGs in developed and developing countries.

The G20 Principles to Scale Up Blended Finance in Developing Countries, including Least Developed Countries and Small Island Developing States

#3. Promote optimal operationalization and delivery of blended finance in developing countries, including LDCs and SIDS.

“……….. This includes the support of dedicated global institutions, including Multilateral Development Banks (MDBs) and the role played by philanthropies, to engage a wide set of actors and build a global community of support. We acknowledge the proposed initiative by the Government of Indonesia on the Global Blended Finance Alliance that could serve as a global community of support to accelerate investment in climate action and sustainable development.”

 

D. Financing for Development

Establishment of the Global Blended Finance Alliance (GBFA) (Indonesia, OECD)

The GBFA, to be launched on the margins of the G20 Summit, will seek to fill the SDG Funding Gap, through interested financing stakeholders and to implement the G20 Blended Finance Principles, developed in the G20 DWG, across relevant sectoral areas. Various sources of funding, including governmental and multilateral organisations, philanthropies and foundations, and the private sector are considered for the GBFA

Initiated by the Government of Indonesia, the G20 Bali Global Blended Finance Alliance (GBFA) is envisioned as an international organisation to work with partners to strengthen the blended finance ecosystem and fill market gaps. Headquartered in Bali and working with leading content and delivery partners, the G20 Bali GBFA will:

1. Facilitate policy development to scale blended finance in developing countries and furthering the “G20 Blended Finance Principles”. The Tri Hita Karana Roadmap for Blended Finance, developed and launched in collaboration with the OECD and the Government of Indonesia around 2018 IMF/World Bank Annual Meetings, had provided the basis for informing the G20 Blended Finance Principle for developing countries.
2. Accelerate South-South collaboration including capacity building and knowledge sharing to reduce transaction costs, pioneer and share best practices for system shifts to support better outcomes for the SDGs.
3. Facilitate private sector engagement to deepen trust, accelerate pipeline, pilot and scale new partnerships to optimize use of scarce catalytic resources.
4. Help standardize and streamline data sharing to tackle the perception of risk.

The 3 Key Pillars of the G20 Bali GBFA to strengthen developing countries’ capacity to mobilize finance at scale through South South cooperation.

Key Milestones of the G20 Bali Global Blended Finance Alliance

G20 Bali Global Blended Finance Alliance ‘Letter of Intent’ Signing Ceremony on May 20, 2024 around the 10th World Water Forum, nine countries comprising Canada, the Democratic Republic of Congo, Fiji, France, Kenya, Luxembourg, Sri Lanka, the United Arab Emirates together with host country Indonesia signed the ‘Letter of Intent’ as prospective founding members to set up the G20 Bali Global Blended Finance Alliance

Following the 2022 G20 Bali Leaders’ Declaration, the Government of Indonesia has actively held dialogues and discussion around international fora, such as COP28, including bilateral discussion with potential member countries.

If you would like to support the G20 Global Blended Finance Alliance, please reach out to