Blended finance is the strategic use of development finance for the mobilisation of additional commercial finance towards the Sustainable Development Goals (SDGs) in developing countries.
Understanding the indispensable role of Official Development Assistance (ODA) in financing the SDGs, the international community acknowledged the need for significant additional development finance – and accorded a prominent place to private sector participation. The vision underpinning the 2030 Agenda is broad and ambitious, calling for an equally broad and ambitious financing strategy.
The OECD Development Assistance Committee (DAC) in February 2016 agreed to develop ‘an inclusive, targeted, results-oriented work programme’ on blended finance :
Evidence based: Collate evidence and lessons learned on blended finance with a focus on targeting private finance and the use of blended finance across different regions.
Best practices: Develop best practices for deploying blended finance in key economic systems and sectors, such as sustainable infrastructure, and to address specific issues such as climate change.
Policy guidance: Deliver policy guidance and principles on the use of blended finance to deliver development impact.
These mechanisms will provide the much needed recommendations to bring together public and private investors for the use and deployment of blended finance to achieve the SDGs.
Publications and flyers
New! Blended Finance Policy Perspectives: Mobilising resources for sustainable development and climate action in developing countries (pdf)
Development Co-operation Report 2016 : The sustainable development goals as business opportunities
Chapter 3. Blending public and private funds for sustainable development
"Blended finance offers huge, largely untapped potential for public, philanthropic and private actors to work together to dramatically improve the scale of investment in developing countries. Its potential lies in its ability to remove many bottlenecks that prevent private investors from targeting the sectors and countries that urgently need additional investment.....The time is right for development funders to take bold action and actively commit to embracing the blended finance approach in a mainstream and systematic way."
News articles and blogs
Maximising bang for the buck: Risks, returns, and what it really means to use ODA to leverage private funds, Paddy Carter (Development Matters, 15 November 2016
"...the pressure is mounting to find more creative ways to leverage private finance using ODA. But how?"
- Blended finance for climate action: how to mobilise commercial finance at scale, Bonn, 13 November
- DAC High Level Meeting, Paris, 30-31 October 2017
- "Senior Discussion on Developing Blended Finance Principles", Washington, 21 April
- OECD Global Forum on Development - Session 1 : "Financing the SGDs: How to make it happen?", Paris, 5 April
- Workshop co-organised by the European Commission, the OECD and the European Development Finance Institutions : "FX Risk in Development: Managing Currency Risk through Blended Finance, Brussels, 1 February
- Blending4Ag Conference : what can we learn from experiences with blending techniques in agriculture and other sectors, Brussels, 7 November
For more information send an email to: DAC.Contact@oecd.org