THE OPPORTUNITY
Why Public Markets?
Public money is under pressure everywhere. For the development finance sector to unlock private capital at scale, we must meet the world’s biggest private investors where they are: in public capital markets.
Institutional investors – like pension funds – hold the largest pools of capital in the world. Listed instruments account for over 90% of their investment portfolios. Investors seeking attractive returns and greater diversification are directing more of this capital to fast-growing developing countries.
The development finance system must seize the opportunity to tap into these mainstream capital flows and can play a pivotal role in directing them to where they are needed most.
Development finance is disconnected from the world’s largest pools of capital.
By the Numbers
How big are global public capital markets?
The combined size of public debt and equity capital markets is roughly 20 times the value of private markets globally. The difference in the value of the transactions on these markets is even greater.
From Insight to Action
How the Public Markets Coalition drives change
Right now, few development finance mobilisation transactions use structured instruments listed on stock exchanges. The Public Markets Coalition was created to help change this.
MDBs and DFIs have unique expertise and experience in investing in EMDEs and significant credibility with investors. But they have yet to fully leverage this to crowd in the private capital needed to achieve the Sustainable Development Goals.
A strategic and coordinated development finance Public Capital Markets Strategy must leverage the global public capital markets system to scale responsible, transparent finance.
$4.3 tn
Annual SDG Financing Gap
$255 bn
Global Official Development Assistance (ODA)
Equal Access
Towards Equal Public Capital Markets Opportunities
Developing countries cannot rely on shallow and fragmented private markets to finance sustainable businesses and infrastructure. They require deep, liquid public capital markets that match local assets with local-currency financing and reduce vulnerability to foreign-exchange shocks.
There is a unique opportunity to channel domestic institutional capital into these public markets, creating more resilient financial systems capable of supporting real development impact, and giving households and firms the same ability to save, invest, and insure that populations in advanced economies take for granted.
6-8%
Share of global institutional capital invested in emerging market equities
$16 trillion
Total domestic institutional capital in developing economies
Our Role
What does the Public Markets Coalition do?
MDBs and DFIs often lack the internal incentives, capabilities, and institutionalised strategies to make the leap from one-off, bespoke transactions in public markets to institutionalised strategies that continually crowd in new pools of capital.
The Public Markets Coalition convenes development finance actors such as DFIs, MDBs and Development Agencies, their government shareholders and EMDE government agencies tasked with the development of local capital markets, to share and institutionalise scalable public-market strategies for capital mobilisation.
The PMC helps frontline implementers to build public market strategies that go beyond one-off transactions.
Convening & Thought Leadership
Convene development finance and capital market actors to surface insights and build a shared understanding of how public markets can be activated to scale finance for development.
Communicating Research
Distil evidence from leading practice-oriented research into actionable insights for engagement with public markets.
Enabling Application
Compile a Toolkit that provides tangible, replicable precedents that enable development finance actors to operate effectively in public capital markets.
