World Bank Group ups private sector

Today, the World Bank Group has taken a significant stride towards overcoming obstacles that hinder private sector investment in emerging markets with the launch of the Private Sector Investment Lab. This initiative is part of a broader effort aimed at rapidly scaling solutions to address these barriers and foster much-needed investment in developing countries.

To achieve climate goals, manage climate change risks, and combat poverty, emerging markets and developing countries require trillions of dollars in annual investment. Recognising the magnitude of this challenge, the World Bank Group acknowledges the pivotal role the private sector must play alongside development institutions like itself.

The World Bank Group is determined to tackle this issue head-on, bringing its expertise, resources, and leadership to the fore in pursuit of tangible results. The Private Sector Investment Lab will focus on scaling transition finance, initially concentrating on renewable energy and energy infrastructure. The lab will build upon existing World Bank initiatives, with an emphasis on addressing current barriers and prioritising ideas that can be swiftly implemented.

A core group comprising influential figures from private finance and business, experienced in financing, investing, and conducting business in emerging markets, will lead the lab. The composition of this team will be announced in the coming weeks. Collaborating closely with experts from governmental, regulatory, and civil society sectors across regions and industries, the lab will convene regularly and directly report to World Bank Group President Ajay Banga, as well as other leaders within the organisation.

During the Summit for a New Global Financing Pact, Ajay Banga, alongside the lab’s co-chairs Mark Carney and Shriti Vadera, unveiled this new initiative. Mark Carney, renowned as the UN Special Envoy on Climate Action and Finance and co-chair of the Glasgow Financial Alliance for Net Zero (GFANZ), brings a wealth of experience to the table. Shriti Vadera, Chair of Prudential plc and former chair of Santander UK, complements the team’s expertise with her extensive background in business, finance, and public policy.

Ajay Banga, World Bank Group President, expressed the pressing need for a fresh approach to mobilise private investment in emerging markets, citing the organisation’s pivotal role in leveraging resources, convening power, and knowledge to effectively catalyse private capital.

Mark Carney, UN Special Envoy on Climate Action and Finance, highlighted the necessity of scaling investment in emerging markets and developing economies, emphasising the inadequacy of conventional approaches. He welcomed Ajay’s leadership in establishing the Private Sector Investment Lab and stressed the importance of collaboration between private finance, multilateral development banks, and development finance institutions to swiftly create scalable blended finance vehicles.

Shriti Vadera, Chair of Prudential plc, expressed her enthusiasm for Ajay Banga’s commitment to leveraging private finance for global public goods and praised his focus on tangible execution rather than empty promises. She noted that she looks forward to collaborating with Ajay, Mark Carney, and other public and private sector colleagues to make a genuine impact on the ground.