In scaling private capital mobilization for EMDEs, insurers have much to offer: In a global environment marked by competing strategic priorities and weakening multilateral coordination, mobilizing cross-border capital has become increasingly complex. For many emerging mar- kets and developing economies (EMDEs), closing persistent investment gaps—notably in infrastructure, climate resili- ence, education, healthcare—will require more scalable ap- proaches to attracting private capital, alongside stronger data infrastructure, improved transparency, enabling poli- cies and enhanced regulatory guidance.
Since the 2008 financial crisis, capital flows to EMDEs have shifted markedly: portfolio debt flows have grown while cross-border bank lending has stagnated amid tighter pru- dential regulation (Chart 1). Yet even these portfolio debt flows remain concentrated in a small group of larger EMDEs, falling well short of development financing needs of many countries, and are inherently volatile—particularly sensitive to shifts in global risk appetite.
