Weekly brief
LAC development-finance, weekly.
Every Monday: the deals, policy shifts, and donor moves shaping LAC development-finance that week.
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Accessing Blended Finance and Innovative Instruments in Latin America and the Caribbean
Blended finance uses development finance (from governments, MDBs, DFIs and funds like the GEF) to mobilize additional commercial capital for sustainable development, especially where risks are too high for purely private investment. In Latin America and the Caribbean, governments and public development banks mainly access these instruments via sovereign‑level products and as intermediaries that on‑lend to real‑economy projects, while the private sector is the primary target of de‑risked capital through guarantees, concessional tranches and other risk‑sharing tools. NGOs and civil society rarely borrow blended debt directly but are crucial as designers, technical partners and impact monitors, often supported by grants and accelerators. Emerging guidance from the OECD DAC, the World Bank and the GEF stresses clear role division among actors, transparent and targeted use of concessionality, strong domestic intermediaries, and close alignment with country strategies to ensure that blended finance in LAC is effective, scalable and development‑additional rather than a subsidy to private investors.