16 jan oecd-guidance2
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The document provides guidance on developing the OECD's Principles Guidance on Blended Finance. It will be developed through 2019-2020 with expert and stakeholder input. It aims to help implement the Blended Finance Principles and provide references. Key topics to be addressed include defining development objectives, assessing appropriate levels of concessionality, tailoring approaches to local context, managing risks, and evaluating results. Evidence will be built through programs focused on least developed countries, fragile contexts, water and agriculture. The guidance will align with frameworks like the SDGs, Addis Ababa Action Agenda, and enhanced DFI principles on blended concessional finance. It will take the form of a dynamic digital compendium
16 jan oecd-guidance2
- 1. GUIDANCE ON THE OECD DAC BLENDED FINANCE PRINCIPLES A closer look at the Local Context and Results Wednesday 16 January, 9:30-13:00 At the Private Finance for Sustainable Development Conference (PF4SD)
- 2. OECD Blended Finance Principles
- 3. Goals: Guidance serves to support the application of the Blended Finance Principles, providing further clarity and explanation for development finance providers involved in their implementation. 1) Provide practical guidance on the Principles’ policy-level implementation 2) Deliver a dynamic compendium where additional references and input can be contributed and 3) Coordinate policy makers and potentially other development actors Timeline: The Principles Guidance will be developed throughout 2019-2020 Collaborative effort: The OECD will engage with experts and stakeholders throughout the development of the Guidance in form of workshops, conferences and invitations to review Guidance on OECD Blended Finance Principles
- 5. Principle 1 – Development Rationale • How to formulate strategic ambition and policy objectives for blended finance? • How to integrate/link blended finance to overarching development and development finance objectives (e.g. to leaving no-one behind)? • How to define development objectives and expected results in blended finance? Principle 2 – Mobilisation • Policy on market testing for Blended Finance, including the extent to which concessionality is required and warranted to mobilise commercial investment and continuous monitoring of the adequate level of concessionality • Matching Blended Finance approaches and objectives to different stages of market development • Assessing the context specificity of mobilisation • Dynamic benchmarking of mobilisation • Strategic exit from mature blended finance markets Guiding Themes and Questions
- 6. Principle 3 – Local context • A work programme on “Strengthening the local dimension of blended finance” has been initiated with ECDPM and ACET. Principle 4 – Effective Partnering • Approaches to manage risk in blended finance, especially with regard to concessional and grant resources, including policy approaches to (financial) risk sharing • Approaches to reach scale in blended finance, including coordination approaches at policy level Principle 5 – Transparency and Results • A working paper on “Blended Finance Evaluation: Governance and Methodological Challenges” will be soon published, building on a workshop that took place in October 2018 Guiding Themes and Questions
- 7. • Blended Finance in LDCs – Joint UNCDF-OECD Report • Blended Finance in Fragile Contexts • Blended Finance for Water and Sanitation – Joint Sida - OECD Development Co-operation and Environment Directorate Work Programme • Blended Finance for Agriculture – Joint IFAD/SAFIN-OECD Work Programme Building the Evidence Base
- 8. Anchor Blended Finance use to a Development Rationale Additionality/Ratio nale for Using Blended Finance SDGs Design Blended Finance to mobilise Commercial Finance Crowding-in and Minimum Concessionality Mobilisation Tailor Blended Finance to Local Context Commercial Sustainability Commercial sustainability Focus on Effective Partnering for Blended Finance Reinforcing Markets Building inclusive markets Monitor Blended Finance for Transparency and Results Promoting High Standards Transparen cy Underlying Reference Framework - DFI Working Group Enhanced Principles on Blended Concessional Finance for Private Sector Projects Underlying Reference Framework – The OECD Blended Finance Principles Aligning with SDGs, national priorities, and development cooperation principles Key role in mobilizing finance, with careful consideration of appropriate use Sharing risks and reward fairly Structuring and pricing of blended finance instruments efficiently Ensuring accountability, transparency, debt sustainability, and participation Underlying Reference Framework – Addis Ababa Action Agenda The Context: Core Blended Finance Frameworks
- 9. The Tri Hita Karana Roadmap for Blended Finance
- 10. The Shared Value System on Blended Finance Anchor blended finance into the SDGs Commit to using blended finance to mobilise commercial finance Design blended finance to move towards commercial sustainability Structure blended finance to build inclusive markets Promote transparency when engaging in blended finance
- 11. The Principles Guidance Note – A dynamic digital compendium http://www.oecd.org/dac/financing-sustainable-development/blended-finance-principles/