British International Investment (BII), the UK's development finance institution (DFI) and impact investor has announced a $10 million commitment to the SDG Outcomes Fund as an anchor investor alongside the US International Development Finance Corporation (DFC).
The DFIs will support the first fund dedicated to development impact bonds in lower and middle-income countries globally including Africa and South Asia.
Established as a partnership with UBS Optimus Foundation as lead investor and Bridges Outcomes Partnerships, a specialist not-for-profit entity, as a fund manager, the Fund uses an innovative blended finance structure to invest in impact bonds and similar outcomes-based contracts that support the UN Sustainable Development Goals
It targets essential healthcare, education, employment, child protection, and environmental outcomes aimed at improving the lives and livelihoods of some of the world's most vulnerable populations.
As a leading impact investor, this marks BII's first investment in development impact bonds. The fund will target some of the most challenging sectors and vulnerable communities as well as advance financing tools that help accelerate the progress of key development challenges facing the continent.
SDG Outcomes has made initial investments in West Africa, providing upfront capital to initiate and deliver education and environmental services. The fund aims to invest more widely across Africa and South Asia.
Mila Lukic, CEO of Bridges Outcomes Partnerships said, "We're hugely excited by the potential of SDG Outcomes to improve lives at scale and, over time, to transform the way in which development projects are designed and delivered. Around 600 million young people globally lack numeracy and literacy skills;
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"...millions more are suffering from the effects of plastics pollution. We are pleased that SDG Outcomes' first projects are helping to address these challenges through innovative, outcomes-based partnerships."
Maya Ziswiler, CEO of the UBS Optimus Foundation, added, "The SDG Outcomes initiative is one of the first of its kind to provide the scale so desperately needed to provide real impact. By creating an investible solution".
Andrew Mitchell, UK's Minister for Development and Africa, commented, said, "This commitment will support sustainable development projects in developing countries, particularly in Africa and South Asia, giving some of the world's most vulnerable communities the means to provide local solutions to local problems.
"Not only will Development Impact Bonds improve healthcare, education, and child protection, they will also support economic growth and climate action, giving a much-needed boost to the UN's Sustainable Development Goals."
