Mitigating Currency Risk

Discussions should focus on scaling credible, harmonized frameworks for emissions accounting and transition finance, leveraging initiatives like the ISO–GHG Protocol partnership to simplify compliance and improve comparability.

Discussions should focus on scaling local-currency and FX risk-mitigation instruments to unlock private finance for EMDE infrastructure and climate projects. MDBs and DFIs should explore how blended finance, FX liquidity facilities, and derivatives programmes can reduce currency risk, support sustainable domestic capital markets, and align investments with national development priorities.

1.Highlighted that climate finance and economic stability are interwined priorities 2. Discussions held around the need to build smarter prudential regulation alongside public finance instruments that can better absorb risk and crowd in private investment. 3. African and Latin American finance ministers also called for stronger representation in global financial governance.

A Knowledge Cafe' on the theme of Scaling Local Financing to close Infrastructure deficits highlighted the issue of rising foreign exchange risk in infrastructure financing for EMDEs. It involved sharing of insights from WBG knowledge/ country programs and international private investors to decode proven pathways and interventions to stimulate an action-oriented dialogue on local infrastructure financing solutions.