The Global Emerging Markets Risk Database (GEMs) Consortium is a joint initiative of 29 multilateral development banks and development finance institutions that pools 40 years of credit risk data on their lending operations in emerging markets. It provides the related statistics at no cost to members and to the public at gemsriskdatabase.org and on other platforms like Bloomberg and Data360.

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The European Investment Bank and the International Finance Corporation (IFC) created the Consortium in 2009. It has since evolved into a community of practice that develops common approaches and data methodologies to record default and recovery statistics. It offers insights into the true potential of emerging markets.

The GEMs Consortium is governed by a Steering Committee co-chaired by EIB and IFC and comprised of senior officials from the European Bank for Reconstruction and Development (EBRD), the International Bank for Reconstruction and Development (IBRD), the African Development Bank (AfDB), the Asian Development Bank (ADB), and the Inter-American Development Bank Group (IDB Group).

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Emerging markets face the greatest investment need in physical and social infrastructure, ranging from energy, transport, water and digital connectivity to health and education, but have long been viewed as high-risk destinations for investment. Aligning with the G20 roadmap which calls for increased investments in emerging markets, GEMs statistics provide more clarity around these risks, separating fact from perception, and grounding development goals in real evidence.

Access to default and recovery rates of multilateral development bank and development finance institution loan portfolios can help investors assess the risks of investing in emerging markets, especially when investing alongside these institutions. The information could help mobilise private capital where it is needed most.

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The three GEMs publications issued in October 2025 reveal two key points:

1 - Default rates for GEMs member institutions in emerging markets compare to those of non-investment grade firms in advanced economies,

2 - Recovery rates surpass global benchmarks.

• Annual default rates for private lending average 3.54%.
• Recovery rates for private lending average 72.9%.
• Annual default rates for public lending average 2.61%.
• Recovery rates for public lending average 85.8%.
• Annual default rates for sovereign and sovereign-guaranteed lending average 0.77%.
• Recovery rates for sovereign and sovereign-guaranteed lending average 95.1%.

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GEMs Consortium members, including The African Development Bank, contribute their data to GEMs and leverage the overall GEMs statistics to inform their risk models.

The GEMs Secretariat is currently working with colleagues in the Group Risk and Compliance Directorate to determine how the statistics can support EIB's risk modelling efforts with a view to ensuring fair outcomes for emerging market clients.

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GEMs shows that the risks of investing in emerging market firms are lower than investors may have perceived. During global crises, default rates in emerging markets were lower than in advanced economies, providing diversification benefits when it mattered the most.

A country's sovereign risk rating overstates the default performance of its corporates. Opportunities exist to tap pools of domestic savings away from sovereign lending and into private sector projects. Mobilising financing alongside multilateral development banks and development finance institutions increases the likelihood of experiencing default and recovery rates similar to those recorded by GEMs.

For more information about GEMs, visit gemsriskdatabase.org. Follow GEMs on LinkedIn at @GEMs | Global Emerging Markets Risk Database.