News & insights
Date: November 2021 | Client: IFC | Sector: Infrastructure | Expertise: Finance & transaction advisory
New infrastructure investment approach to benefit millions across the Pacific region
The guide 'Co-Investment Options in Infrastructure: A Guide for Institutional Investors', which has been published by the Pacific Islands Investment Forum (PIIF) and International Finance Corporation (IFC), identifies options for establishing a co-investment function that will help direct long-term capital into attractive projects, boosting investment in industries, services and infrastructure across the Pacific. The co-investment approach will enable PIIF – a regional network of 18 provident, superannuation, trust and sovereign wealth funds from 12 countries with approximately US$8 billion under management – to channel capital within the Pacific region and provide access to high quality cross border investments that would have been out of reach for most member states.
The publication draws on global examples, including IFC’s Managed Co-Lending Portfolio Program, detailing different ways long-term investors make collaboration and mobilization work in the international investment landscape. Once a platform is in place, it could facilitate new investment opportunities. The guide identifies six co-investment options, weighing up elements including level of control by investors, flexibility, and barriers to setting them up.
Pacific nations face many challenges in the delivery of essential infrastructure in sectors such as sustainable energy, health, transport, logistics and telecommunications. It’s estimated that from 2016 through to 2030, US$46 billion in investment is needed to overcome the region’s infrastructure deficit. The release of the guide comes amid a growing recognition internationally of the need to reduce emissions and avert a climate disaster. Pacific nations are among those most at threat from harmful climate change. The co-investment model offers a conduit for sustainable investment in climate-smart infrastructure and an opportunity to crowd investors into green solutions.
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