European Development Finance Institutions

Cooperation among European Development Finance Institutions through the EDFI Association and its joint financing facilities.

EDFI, the Association of European Development Finance Institutions, was founded in 1992 and currently has 15 member institutions. EDFI member institutions are focused on the development of private sector enterprises and operate in emerging and frontier economies. They are mandated by their governments to contribute to the global development goals by creating jobs, boosting growth, and fighting poverty and climate change. Although EDFI members have slightly different mandates and strategies they are guided by a common vision:

To improve people’s lives – for current and future generations – in the world’s poor places through the engine of private sector growth.

Collectively, EDFI member institutions employ more than 2,100 investment professionals and support staff working from headquarters in Europe and 42 overseas offices in 22 developing countries. They made 886 new investments with a value of €7.2bn in 2017 and the total portfolio was €37.2 at the end of 2017. The largest sectors in the portfolio are financial institutions and renewable energy infrastructure, as well as job-intensive sectors such as manufacturing and agribusiness. 31% of the commitments are in Sub-Saharan Africa and 20% in least-developed and other low-income countries. The contributions to development outcomes, across the financed companies and projects, were > 5 million jobs, and 67 TWh of electricity and >€10bn in tax contributions to governments during 2017.

EDFI members can, in many instances, be more effective and efficient by working together. In addition, as European institutions, they share a common desire to support the EU in its development efforts. They have created EDFI as a value-adding platform and a service provider that supports all members to realise their shared vision by: 

  • Facilitating knowledge-sharing and learning; and improving efficiency and effectiveness
  • Fostering cooperation with EU institutions, and with other DFIs such as bilateral DFIs outside Europe and with multilateral banks such as the IFC
  • Helping raise the profile of European DFIs
  • Providing financing opportunities to EDFI members

EDFI members seek to harmonise their responsible investment practices. EDFI members have adopted a shared set of principles for responsible financing, which underlines that respect for human rights and environmental sustainability is a prerequisite for financing. EDFI members have also adopted harmonised environmental and social standards for co-financed projects, and a shared exclusion list. They have also adopted shared principles for responsible tax in developing countries. Building on these commitments and standards, European DFIs can help clients and partners implement more responsible business practices and improve project outcomes.

There is a high level of financial cooperation among EDFI members. 31% of investment in the portfolio are co-financed by two or more EDFI members. EDFI manages several joint financing facilities, offering members co-financing opportunities and complementary risk-sharing and risk capital facilities such as ElectriFI and AgriFI. In 2016, EDFI set up the EDFI Management Company to promote further financial cooperation. 25 dedicated professionals work in the EDFI Secretariat and EDFIMC.

More information can be found on www.edfi.eu.