Finance for growth

Frédéric Blanc-Brude

The World Bank Group’s initiative to Maximize Finance for Development (MFD) aims to find solutions to crowd in all possible sources of finance, innovation, and expertise in order to achieve the Sustainable Development Goals (SDGs).

In the case of infrastructure investment, a significant contribution to long-term sources of private finance is expected from institutional investors such as pension plans, life insurers, and sovereign wealth funds. These investors have become increasingly interested in infrastructure investment in recent years, in search of new sources of returns, diversification, duration and inflation hedging.

However, they cannot be expected to make a substantial and durable contribution to the long-term financing of infrastructure without three important changes. Current valuation methodologies used in private infrastructure are wrong. Fifty percent of respondents of the largest survey of asset owners ever undertaken... —