1. Themes
  2. Domestic Mobilization
  3. Domestic Financial Market Development

Domestic Financial Market Development

Domestic savings are expected to play a critical role in meeting EMDE climate finance goals, but domestic markets need assistance to build the necessary breadth and depth to support such engagement.

2030 Goals

01

Deep and liquid domestic financial markets are capable of providing long-term, affordable financing to climate investments in local currency.

02

Domestic financial institutions (public and private) are empowered to structure/originate climate investments in line with country-sector plans, with international financial institutions providing co-financing and secondary investment at scale.

03

Public development banks are seen as critical intermediaries to channel domestic resources into climate-aligned investments. However, limited fiscal space and shallow markets remain barriers to scaling domestic climate finance.

Status

No Progress

The World Bank, IMF, and other DFIs have supported the development of domestic financial markets in EMDEs for decades. Although progress has been made in strengthening local currencies and increasing locally-issued debt, investors in EMDEs are still heavily reliant on capital markets in advanced economies. The need to quickly scale climate finance in EMDEs adds urgency to this goal.

Domestic financial market development is a long-term effort that will require increased support from DFIs and changes in macroeconomic policy, financial regulation, and sectoral expertise. Coordinated international efforts have been sporadic over the last decade with few exceptions (e.g. Bridgetown Initiative, Addis Ababa Action Agenda).

Leading Actors

Cooperation is required between these actors and audiences to drive progress foward in Domestic Financial Market Development.

Private FIs

DBS Bank

Private FIs

Luxembourg Green Exchange

Private FIs

ARM-Harith

Private FIs

InfraCredit

Private FIs

Caisse de dépôt et placement du Québec (CDPQ)

Private FIs

FrontClear

Private FIs

TCX

Private FIs

Africa Investor (Ai) Group

Private FIs

InfraZamin

Private FIs

Standard Bank Group

Private FIs

PIDG

Private FIs

GARI Group

Private FIs

Pollination

Private FIs

Zurich Insurance Group

Public FIs

Development Bank of Southern Africa

Public FIs

Brazilian Development Bank (BNDES)

Multilateral Development Banks

African Development Bank (AfDB)

Public FIs

Agence Française de Développement

Public FIs

British International Investment

Public FIs

KEPFIC

Public FIs

NSIA

Multilateral Development Banks

European Bank for Reconstruction and Development (EBRD)

Multilateral Development Banks

MIGA

International Organizations

International Monetary Fund

International Organizations

Financial Stability Board

International Organizations

OECD

International Organizations

EAVCA

International Organizations

United Nations Development Programme

Leading Countries

Barbados

Leading Countries

India

Alliances

Bridgetown Initiative

Alliances

G20

Supportive Stakeholders

3i Advisory

Key Milestones

Showcasing the key reform milestones for Domestic Financial Market Development that have been addressed at global events.

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Washington, DC

WBG/IMF Annual Meetings

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  • Fiscal reforms and regulations

    Countries present success stories from the JDRMI, with increased private sector financing for climate projects.

  • Domestic Financial Market Development

    Domestic financial market development is indispensable for climate finance, but EMDEs need structural reforms, debt relief, regulatory clarity, and international support to mobilize domestic savings effectively.

Learn More

Publications and educational material to deepen understanding of Domestic Financial Market Development.

Bridgetown Initiative: a transformation of development finance system for improved climate adaptation and resilience in emerging economies?

Domestic Financial Market Development

The Bridgetown Initiative aims to overcome some of the main shortcomings of mobilizing climate finance for EMDEs.

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Bridgetown Initiative 3.0: Bridgetown Initiative on the Reform of the International Development and Climate Finance Architecture

Domestic Financial Market Development

The Bridgestone Initiative operates through a series of proposals, most recently the "Bridgetown 3.0" agenda launched in late 2024, which seeks to implement specific actions and has set the end of 2025 as a deadline for key advancements.

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Sustainable Banking Network

Domestic Financial Market Development

The Sustainable Banking Network (SBN) is an informal and exclusive group of banking regulators and associations that are interested in sustainable banking policies, guidelines and practices. Its main objective is to facilitate the collective learning of its members and to support them in policy development to create drivers for sustainable finance practices.

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Addis Ababa 4th International Conference on Financing for Development Sevilla, Spain | 30 June - 3 July 2025

Domestic Financial Market Development

The outcome document of the Fourth International Conference on Financing for Development present to the co-chairs of the FFD4 Preparatory Committee their final revised text of the Sevilla Commitment (Compromiso de Sevilla). It reflects the co-facilitators best efforts to arrive at consensus and reflects a balanced, ambitious, and action-oriented outcome document.

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