(Yicai) July 5 -- The G20 Bali Global Blended Finance Alliance was established by nine founding members at the 10th World Water Forum held in Bali at the end of May to bridge the gap in financing for climate change actions and to achieve sustainable development goals. 

“Huge news from the 10th World Water Forum in Bali!” AVPN, Asia’s biggest social investment network, said on LinkedIn. Nine countries have joined forces to create the G20 #Bali Global Blended Finance Alliance (GBFA). This alliance is a major step forward in using blended finance to boost green investments for developing countries and island nations. Led by Mari Elka Pangestu, the GBFA will play a crucial role in mobilising resources for climate action.”

A GBFA G20 Letter of Intent was signed on May 20 by the nine founding member countries, as well as three representatives from G20 countries, financial hubs, island nations and African countries.

The mission of the G20 Bali GBFA is to scale and replicate blended finance instruments, such as structured funds, concessional finance and performance-based grants, that can be used alone or in combination to mitigate investment risks in developing countries. Based on the G20 Blended Finance Principles, it will accelerate investments, modernize the development finance system by reducing transaction costs, unlock opportunities for transition finance, capacity building and strengthen network across relevant actors.

“Currently, the Blended Finance mechanism has been used in South-South Cooperation to strengthen the implementation of national strategic programs, such as in the forestry sector, energy transition and infrastructure,” said Indonesian Coordinating Minister for Maritime Affairs and Investment Luhut Pandjaitan.

The alliance, which is headquartered in Bali’s Sanur Special Economic Zone, is led by Mari Elka Pangestu, Presidential Special Envoy for Climate Finance, Vice Chair of the International Finance Forum, former Minister of Trade of Indonesia and former Managing Director of the World Bank.

The International Finance Forum (IFF) is an independent, non-profit, non-governmental international organization established by more than 20 countries and international organizations in 2003.