European Fund for Sustainable Development Plus (EFSD+) is part of the European Union’s investment framework. It supports public and private investment in partner countries worldwide by providing financial guarantees and technical assistance to promote inclusive economic development.
EFSD+ has allocated approximately €300 million in unfunded guarantees and technical assistance to IFC’s Better Futures Program, which will build on IFC’s experience in mobilizing investment at scale for innovative solutions to climate change, fragility, conflict and crisis response, job creation and inclusive growth. This IFC-implemented blended finance facility will focus on de-risking investments that help build resilient livelihoods – especially in the context of conflict and fragility – and promote decarbonization and climate resiliency.
The facility will largely focus on de-risking high-impact investments in middle-income countries and low-income countries not eligible for blended concessional finance under the IDA Private Sector Window, including Ukraine and countries impacted by the Russian invasion of Ukraine.
IFC will also implement the following facilities supported by the European Commission:
- Small Loan Guarantee Program (SLGP): The €58 million SLGP will use a mechanism to pool together a portfolio of IFC risk-sharing facilities with IFC’s partner financial institutions to encourage them to expand their small and medium enterprises lending portfolio. This is the first blended finance collaboration between the European Commission (EC), the International Development Association, IFC. IFC will leverage the program to spur business development with existing and new clients based on lessons learned from the IDA-only supported part of the SLGP over the last few years.
- In addition, the EC has approved two IFC programs that will focus on agriculture and climate in the Western Balkans. These programs are expected to be launched by July 2023.
