'Leveraging' private sector finance: how does it work and what are the risks?

Added 19 Apr 2012

Eurodad partner The Bretton Woods Project has launched a new report, on  'Leveraging' private sector finance.

The notion that public investments should be used to ‘leverage’ additional investments from private actors is increasingly used in a variety of development finance forums, including aid, development finance, agriculture and, in particular, climate finance. The World Bank has become one of the leading proponents of this concept, though nowhere has it spelled out clearly what it means by ‘leverage’ or how it should be measured.

This briefing (a) helps explain the existing ways in which the World Bank Group attempts to use its investments to leverage additional investment from private actors, and (b) briefly lays out some key risks associated with doing this. Though the term is also used by other bilateral and multilateral institutions, the focus on the Bank is because of its central role in this debate, and because it already practices most of the methods associated with leverage.

A fully formatted and referenced PDF version of 'Leveraging' private sector finance: how does it work and what are the risks?' is also available