Blog

To get more capital, Africa needs more data

GEMs3.0 Media2024-12-03T09:47:01+00:00

Poor data and small capital markets make it hard to gauge risks and returns The concept of risk is completely invented to ensure that investment doesn’t come to Africa,” Gagan Gupta told an audience of investors and entrepreneurs earlier this year, to resounding applause. Mr Gupta, whose firm works on logistics and utilities across Africa, is optimistic about the continent and scathing...

How development banks are failing to attract enough private money to climate fight

GEMs3.0 Media2024-11-26T12:48:52+00:00

As officials from around the world strive this week to reach a deal on funding for poorer countries to tackle climate change, investment manager Rob Drijkoningen is the sort of person they're hoping will help get them there. Drijkoningen is head of emerging market debt at U.S. asset manager Neuberger Berman, which holds $27 billion in sovereign and corporate debt from...

Natural Capital on African Governments’ Balance Sheets initiative introduced at COP16

GEMs3.0 Media2024-11-04T16:56:57+00:00

The Sustainable Markets Initiative (SMI) Africa Council has unveiled a new initiative aimed at making natural assets a core component of national balance sheets. The Natural Capital on African Governments’ Balance Sheets initiative is an institutional investor-public partnership led by the SMI Africa Council, which brings together institutional, technology and legal partners such as the African Union Commission, Africa Investor Group,...

What Are Nationally Determined Contributions (NDCs) and Why Are They Important?

GEMs3.0 Media2024-11-04T11:34:13+00:00

The impacts of climate change have been on stark display this year, from severe flooding in Brazil and East Africa to droughts in Mexico and Europe and wildfires in Canada. Record-breaking heat has claimed lives around the world. These disasters are evidence that the world has not yet done nearly...

GEMs Consortium Issues More Granular Data; Critics Seek More Transparency

GEMs3.0 Media2024-10-24T19:00:48+00:00

The Global Emerging Markets Risk Database (GEMs) Consortium Oct. 15 reported on country-by-country loan default and recovery rates for the first time, but the Consortium has still not met the key transparency demand: making the database accessible. The new data was called insufficient by critics in the private and nonprofit sector who say that issuance of more detailed information is necessary...

Private Sector Observers Seek More Information From GEMs Database

GEMs3.0 Media2024-10-24T14:43:39+00:00

Partially lifting the lid on a “treasure trove” of international economic data has not dampened interest in getting a closer look inside, but the crystal ball for the future is hazy. The valued data in question is known by the acronym GEMs. There’s information from 26 development finance institutions covering 20,000 contracts over 30 years. GEMs is run by a consortium...

Major MDBs Have Rating Headroom for USD480 Billion in New Lending

GEMs3.0 Media2024-10-14T13:38:18+00:00

Major multilateral development banks (MDBs) could increase lending by nearly USD480 billion collectively before the decline in capital positions would lead to downgrades, Fitch Ratings says in a new report. Fitch does not expect MDBs to use their lending headroom in full. We assessed how much lending would be consistent with unchanged ratings for each of the 12 largest Fitch-rated MDBs,...

Quantifying Preferred Creditor Treatment by Rating Grade

GEMs3.0 Media2024-10-14T13:26:03+00:00

The business models of Multilateral Development Banks (MDBs) depend crucially on Preferred Creditor Treatment (PCT). PCT refers to the de facto seniority that financially distressed sovereigns accord to MDBs from which they have borrowed. In an earlier paper, Risk Control (2022), we showed, in a matched sample, that the Probability of Default (PD) of MDB sovereign loans is substantially less than...

NDC Investment Summit SMIAC Investable Asset Classes Working Group

GEMs3.0 Media2024-10-08T10:58:32+00:00

GEMs3.0 Investor and Philanthropy Consultation by Mahesh Kotecha, CFA

The global financing needs for climate initiatives are immense, with estimates indicating a shortfall of tens of trillions, particularly in Africa. Attracting private capital at scale is essential, yet a major constraint is the need for robust risk assessment data and risk migaon structures in emerging markets. The GEMS 3.0...

African default rates by rating category are similar to global sovereign default rates

GEMs3.0 Media2024-10-08T10:53:45+00:00

There has been significant market interest in how default rates for African sovereigns compare to those for similarly-rated sovereigns in other regions, particularly as market spreads for African sovereign debt have been higher than those for other sovereigns at the same rating level. Below, we outline our review of the historical default experience which shows that default rates per rating category...