 to mobilize capital and do partnerships with folks on the ground so maybe Agnes you can talk a little bit about what that evolution has looked like at USAID. Sure, thank you. Thank you for that great introduction. So I think the reason USAID and other donors have really started moving into space is kind of in this space is threefold. First, we've noticed that there's actually a lot of interest from private investors to invest in some of the emerging markets and some of the developing countries where we actively work and have been working for 50 years. Second, there's actually a lot of private capital that has already flow into these markets and this is also this is not just because of this interest but it's also because these countries the emerging markets and developing countries where we work actually are demanding more investments and need more investment to come in so they're not just depending and asking for aid they're asking for private investment. And third, we really recognize that this is a great opportunity for donors to leverage some of that interest and some of that capital and I should mention that that capital also brings skills and knowledge with it. It's not just about the money. To really leverage all of those resources towards the sectors where we work such as agriculture, health and education and to try to really expand the pie of resources available for those countries and for those sectors to grow and to really achieve scale. What kind of resources do we offer and what are we trying to leverage? So really we have a couple of types of resources that I think are useful to investors. First, we obviously deploy grants. Second, we offer guarantees which Eleanor will talk about in a second. Third, we have a network in over 80 countries of local actors who we have been working with as I mentioned for 50 years. So we have a great local presence and we're often seen as a transparent broker who can really introduce private sector to an investor to the developing countries and to entrepreneurs and organizations that are working there. And last, we do have substantial convening power. So we are able to bring in not just the local actors like I mentioned but also other donors and other organizations who are working in these countries and in this space which a lot of private sector investors found very beneficial mainly because it's difficult as you can imagine to really understand what's happening in Kenya. It's a lot easier if you can convene all the actors who are working in a sector of education and speak to them all at once. So those are the four resources that we're really trying to leverage. Grants, network, guarantees and the convening power. And I actually really excited to share the stage with the others here because they will give you examples of exactly how USAID and other donors are trying to leverage those resources because we're working with all of them. So I'll just turn it to them at this point. Yeah, I think maybe we'll start keep it inside USAID permanent and come to Eleanor. But I think for I see some familiar faces so I think some of the folks here are probably familiar with the development credit authority and the guarantee power that USAID has but some may not be. So maybe you can Eleanor just share a little bit about what DCA is doing. I used to manage the impact investment portfolio at JPMorgan Chase and was an early recipient of some of the creative work that you all are doing. So we'd love to hear about sort of how that's evolved and how you're using that tool to accomplish some of the partnership and collaboration that Agnes referenced. Yeah, great. So thank you Amy for the introduction and Agnes set me up very well because she ran through the menu of interventions that we have in moving the aid community towards investment. One of the very specific tools we have is offered by my office at USAID, the development credit authority. I think when most people think of USAID they think of us as the government's aid agency. We do do this. We have one commercial tool in my mind which is the loan guarantee tool. So we don't do direct debt investments. We don't do equity investments but we have the guarantee tool which we use to partner with private financial institutions to share the risk on private debt investments into sectors that we are supporting otherwise through our technical assistance. So we in DCA we like to think that we've been moving from aid to investment since 1999 when we gained as the agency the authority to issue these guarantees. Since 1999 we've built up a portfolio of 5.4 billion in commitments out of which we have actually leveraged 1.9 billion in loans. So just to, I usually have a nice visual to explain this but if you can picture in your mind a private lender, that lender can be a local bank, it can be an international bank, it can be a microfinance institution and as Amy referenced we are evolving and probably piloted it with Amy through our deal with J.P. Morgan lending into a fund. So guaranteeing a loan into a fund. So we're partnering with these private lenders to share the risk 50-50 on a peri-passive basis for loans to either a single borrower or a portfolio of borrowers like I mentioned in sectors that we support through our technical assistance. We had agriculture, education, more and more, we're looking at renewable energy, etc. So we, since 1999 we have really evolved as a guarantor. So like I said really focusing originally on local currency, local financial institutions but more and one reason I'm here this week is we are working with non-traditional debt providers. And I would say in the example with Amy, I think actually the borrower was a little more non-traditional for us. It was the African Agriculture Capital Fund and it was a fund that was raising both commercial debt through J.P. Morgan but also some grant funds. We used the guarantee to pull in J.P. Morgan's commercial debt which was used to catalyze the additional grant funds from Rockefeller, from Gates, for the fund to on-line to agribusinesses across East Africa. Really how we think of it and Amy can confirm that the guarantee is really what got J.P. Morgan over the hump in terms of being willing to take that risk and this is really where we see our value add. The guarantee is a U.S. Treasury backed guarantee. It's AAA rated. It's been very appealing for investors often to enter sectors and markets where they would never look otherwise. So we have with our 1.9 billion in loans dispersed, we feel as if we have been very successful and look to continue that. I could go on and on with examples but maybe I'll leave it there for now. Yeah I know for sure I can remember this is a quick anecdote like doing the credit analysis at J.P. Morgan when we did this transaction and they were like oh so half of this is exposed to East Africa to small enterprises in the agricultural sector so it's like the most extreme highest risk rating possible but they're like the other half is the U.S. government. This is great we can do this. You only got 50% on the line. Yeah exactly. So let me then to come back to come outside of USA so Gerhard and Jacob are here really to represent the practitioner perspective and I gave only brief intro so you should feel free to provide some organization organizational context excuse me for this but it'd be great to hear about some examples that you all have and the work that you've done with aid and other donor agencies to sort of do sort of affect the development objectives that you have on the ground. Sure well thanks very much for having me as a bit of background so cross boundary is a frontier market investment advisory firm we have about 30 investment professionals we have three offices in Africa and offices in D.C. in New York you know I think in terms of how we've been able to partner with USA to align private capital with development outcomes I would put into roughly sort of two categories. The first category would be working with USA to solve risk mitigation problems or capital supply problems. So as an example about three years ago we set up a small investment vehicle called Cross Boundary Energy to invest in rooftop solar for businesses in Africa on a PPA a power purchase agreement or a long-term asset lease basis. It was a new asset class you know I think investors were a bit skittish about it and as we structured that vehicle USA came in with a $1.3 million subordinated capital contribution essentially meaning that it gets paid back second to the private investors and with that commitment we were able to raise an additional 8 million of private capital for about a $10 million investment vehicle which is now almost fully deployed and we'll be out raising the next vehicle this winter. So I think there was actually two benefits from that sort of interaction one is the credibility that the involvement of USA and the US government brings to a transaction and the other of course is the sort of sweetener of that blended capital and slightly improving the investors risk profile in the return. So that's sort of in the risk mitigation category. The other category would be in the transaction cost challenge the transaction cost challenges in these smaller and shallower markets. In new and markets particularly in fragile states you know often the investment size is rather small and the transaction cost to set up structure and properly diligence that investment cannot weigh at least on a private basis the potential return. So as an example on the advisory side we partnered with USAID in Mali in West Africa certainly a fragile state to have a small team of advisors on the ground to help support investors coming into that market and that's been a successful program over the last two years helping directly facilitate over 30 million dollars of private investment from a diverse set of investors including INP which is a fund manager who I believe actually is here at Socap IFC in Jarrow and a number of other regional private equity firms. So those are I think two examples of how USAID can help address barriers on the capital supply side or in these sort of transaction cost issues that often can sort of make it very difficult to undertake smaller and riskier transactions. Thank you Amy. Gearheart Chris with Serona asset management based in Toronto and Amsterdam. I even five years ago I wouldn't have imagined myself sitting at a podium like this with public sector players. For the last 20 years I've been studiously focused on private investors only private capital markets only and that was because about 20 years ago I'd appealed to a number of sovereign development agencies to invest in developing countries not grant and I recall one situation where I was pretty much run out of town I gassed these people I gassed that we would actually invest in say sub-Saharan Africa and expect capital return I mean that you don't do that you just donate to Africa you don't you don't invest there and that was that was a response that we used to get and so we studiously stayed away from public sector relationships for the longest time but that changed about five years ago when I got a call from a friend who said you've got to come to Ottawa because the Canadian government's thinking new thoughts and I thought you know I'm not doing that he convinced me to allow him to speak to the Canadian government on our behalf and out of that came the beginning of relationships where we've actually doubled down in working with public private in a public private collaborative way with a number of sovereign development in institutions and DFI's etc so just for to answer your question Amy for example we did strike a relationship with the Canadian government where they invested in one of our funds they put in 15 million which to to mitigate they put in for 15 million in a fund as a first and last out basis and that catalyzed about eight times that from private capital investors who thought oh my now the risk-adjusted rate return relationship looks pretty attractive so that that was one of them another one was where we simply acted as a conduit for some USAID funding to SMEs in Southeast Asia to innovate in the field of women's empowerment so these are investing companies of ours in Southeast Asia and an RFP went out come up with innovations innovations that empower women to advance in your business and so without without just prescribing what that should look like and forward came all these proposals and based on based on those proposals if your proposal had a cost a ticket of 100,000 you know we throw in 50 or the AID program would throw in 50 as a as a as a shot in the arm to help you do it and then we disseminate the results of that throughout our portfolio companies around the world so we really cool stuff and then finally one other nod to AID here who which has grown in in my estimate then in my respect a whole lot over the last few years the we've we've partnered with AID to explore one of the one of the main bottlenecks to the flow of private capital to developing countries and that's FX risk the capital markets haven't done a really good job of figuring out how to mitigate the FX risk the foreign exchange risk when you invest wherever you're based you invest in another country you want to take that capital back home eventually or soon in any case you you're exposed to foreign exchange risk and if you're a pension fund with with liabilities you've got to be paying your pensioners over the next 10 years 50 years 100 years you don't want to take on too much foreign exchange risk the capital markets haven't done a good job of dealing with that and particularly I mean our investors we feel it since it goes in big ways but in June 2014 when the oil price collapsed the US dollar began to spike and financial returns Americans investing in other markets around the world got gutted the US dollar rose the investments may have been performing well in those local currencies but of course the returns got gutted and pay has done some market studies and found that that foreign exchange risk is the second highest rated risks that's why LPs stay on the sidelines and don't invest in emerging markets and so we're working with AID to to innovate on the in the field of foreign exchange risk mitigation can are there firms out there in the world involved in global risk management involved in in hedging involved in FX risk management of some sort are to those firms out there are there ways that you could think of that you could help design new products new strategies to mitigate FX risk and so we're about halfway down the road on that project and there's quite frankly just some really cool innovations coming forward that the market just hasn't developed yet and so thanks to a relationship a partnership with with USAID we hope to be able to come to market in the next year or so with some some interesting new foreign exchange risk mitigation tools great so I think Jake and Gerhard and sort of reflecting on some of the examples that you mentioned you both mentioned themes around risk mitigation reducing transaction costs and things that feel like where donor intervention has been particularly helpful and you were gracious enough to reference the partnerships with USAID as well as part of that but I'm just to take to take a step back from the specifics I wondered if you could sort of comment a little bit about you know what are those thematics where donor intervention is particularly helpful knowing that there are limits to what donor agencies like USAID can do and the types of capital they can provide they've actually got you know got incredible resources on the ground and experience in the markets that you all are trying to to work with which have their own challenges of both of you have referenced and I know Jake you are in particular going into conflict areas and post-conflict areas and trying to help be part of the rebuild story so what are some of the programs or interventions that you think are most helpful and what would you like to see from a partner like USAID to make those partnerships more effective yeah sure and I think you know I think a lot of what Agnes and her team have been doing is you know to use a San Francisco word disrupt the traditional development model to some extent I think there are challenges with the traditional development model as it's been executed there's high barriers to entry to working with traditionally at least to working with USAID and other donor agencies a lot of bureaucratic requirements that have built up over the years that make it difficult for new partners you know particularly ones that are primarily private sector oriented that want to partner with the development community for just one opportunity but that's not their core line of business to understand and interface with those institutions as an example you know when we first structured that subordinated capital facility it took us two years and a lot of lawyers I think now that that model is established it'll be much easier to deploy in the future so I think you know innovation in that way is one improvement that we're seeing from USAID I think another category is you know traditional development sort of did five year plans so you sort of came in to a given country and said here's our five-year vision and we're basically in a fixate on these certain outcomes and you know this sort of spending to achieve those outcomes over five years and so it wasn't particularly adaptable and it couldn't move at sort of the speed and nimbleness of private capital and so how do you make it not only easier for new partners to interface but for you know priorities to shift and adapt and structures to shift and adapt on a much much shorter time horizon so that you can do you know a two-month intervention or a three-month intervention that enables a particular transaction instead of always you know shooting for these very grand ambitious you know country-wide plans I would say that it's it's all about risk adjusted rate of return it does come down to that we've been working with with African health African ministers of health who are looking for private capital investment into the health care sector the health sector in their countries and Africa has 15% of the global population a higher percentage of the global disease burden yet of private capital investment in health care one tenth of one percent lands in Africa it's crazy there are 250 trillion dollars of capital in the markets all of that all of it would go to African health if that presented the best risk adjusted rate of return it doesn't but it's not rocket science to solve not that we want 250 trillion there but it's not rocket science to solve and it is it is about the risk adjusted rate of return and there there are ways that that one can Jake mentioned mentioned a couple ways that one can tweak that risk adjusted rate of return of of an investment target through through through structuring through blended capital we talked about FX risk for example there are ways of adjusting that risk adjusted rate of return John Lorraine I just see you there converges it's all about blending public and private capital to tweak that risk adjusted return to draw in and catalyze private capital into those markets and so that's that's what I would say would be that's that's the biggest pain point for private investors yeah I love African health but goodness you know I'm gonna lose my money yeah could I just get to add slightly to that you know I think there are situations where there's a good available there's a good opportunity that has the right risk adjusted rate of return but the investors in the capital are not aware of it or they don't have the right capital channel to access that opportunity and so I think part of you know where USAID and the network basically of intermediaries and advisories can help is economizing on essentially those search costs because as a you know a single investor perhaps based in San Francisco you might have the theoretical appetite to invest in health in Uganda but your sort of initial cost just to understand that landscape and find the opportunity might not be there and that's where sort of blended finance can play a role to provide a vehicle such that those investors can access the opportunities yeah so I so it's hopefully obvious to those of you in the audience even though we don't spend time together on a stage like this very often there's been a lot of conversation and I think I think a lot of the work that Eleanor reference in terms of the buildup that's happened in DCA is sort of one example of what's been happening at USAID is a great representation of sort of trying to pick out some of these learnings from the different things that have happened on the ground and figure out what are the models that really result in the most effective partnerships and there is now I'm gonna leave it to Agnes sort of explain this but sort of real interest in trying to launch and design a platform that will capture a lot of the learnings that these these these folks have talked about and really help to accelerate the interest in the number of transactions that are happening with this concept of blended finance of using donor money in a more effective way to mobilize private capital so do you want to give a preview for the audience of what you all are thinking about sure I mean as you mentioned you know we feel that blended finance and blended capital solutions are really powerful and it's a really powerful development tool that we are trying to innovate around we're really are trying to be better at reaching out to those who are already deploying it or coming up with new innovative solutions of how to deploy it and sometimes it's not easy but we've managed to overcome a lot of obstacles and I'm really happy to to announce that we recently launched a platform which is called invest which will hopefully enable all of you to work with us in a much more efficient and effective way we did form a very small core of partners just to start it it's really a startup within government it's an innovative way of working with others and and the core partners are actually someone who will represent it right here it's cross boundary it's tied line we also have convergence and the AI who are in the audience and this is a platform which we hope we can use to really access not just the capital firm investors but really as I mentioned the knowledge the skills the innovative solutions that can be deployed in the sectors where we work so even if you are not yet working in emerging markets but are interested in working with us and looking at what you can do in emerging markets I definitely encourage you to reach out to us because and to the other partners I should say because we are looking to expand that group that small core group into a large network of partners that can provide the right kind of solutions at the right time to all of our programs overseas that are looking to catalyze investment capital to agriculture to education to health that are looking for helping investors mitigate risk as we've mentioned that are looking to lower transaction costs help investors lower transaction costs and that are helping to build awareness I think that this is a really really important aspect of getting more investment into those sector just building the awareness of the fact that there are investable opportunities in those sectors there are private sector solutions and that we can help that donors can really help catalyze those solutions towards scalable solutions that really have an amazing development impact that would be beyond what grant dollars can do on their own so we are really trying to expand the pie complement grant dollars with investment dollars and really build a very strong network under this and best platform so I'm very very happy that we were able to do this and it was a great partnership we engaged all of these organizations that I mentioned into creating of this platform which is another kind of innovation we did not just go out there and say as USAID this is what we need we actually went out and figured out how do we work with the private sector and we co-created this platform and hopefully we'll be co-managing it with others so I'm very very excited by this yet another innovation yeah no I think I mean I certainly from speaking from for myself for timeline I think something that's really exciting about this is the fact that it's trying to take advantage of Jake and cross boundary bring a really unique skill set and experience and Gerhard and Serona and you have DCA and timeline and convergence and DAI and others who've been involved and trying to bring all of those experiences together in a way that creates the platform that will do everything that you said as far as risk mitigation and reducing transaction costs making it easier to work with USAID which is also really great innovation so I'm so maybe just to come back to the rest of the panelists who've been sort of part of these conversations and the work is ongoing we should I think something to just emphasize here that this is a work in progress and sort of an evolving as as Agnes said a startup so this is expected to grow and evolve as we get more input from the market but what do you all anticipate as far as some of the challenges the sort of implementing this and having it achieve some of the goals and what in your mind does success look like is it more transactions is it deeper partnerships with some of the folks that are already there like how do you all think about the opportunity this yeah I have a comment on that so I think one thing we're very lucky about in setting this up is that we have an in-house tool which is the guarantee so off the bat we have sort of one one player along the spectrum I think you know one thing we talked about earlier on Amy referenced and probably all of you in the room who've ever tried to interact with USAID you know it's very hard it's we are a behemoth we are highly decentralized what is my entry point into USAID I think this is one very specific entry point for us I think through the guarantee arm also it's a very specific entry point then it's hard to notice who to pick up the phone and call but Agnes and I can help you out with that for in my opinion success is that people are picking up up the phone and knowing who to call and I can say from from you know 18 years of experience with DCA in my role especially on the origination side of guarantees we are pounding the pavement looking for good partners I think that through a platform like this partners will start to come they'll be calling us up at least that that is my idea of success here so hopefully many of you in this room can help us with that I'm thrilled to hear that you're starting this new platform this maybe you'll be calling us now I apologize for you know staying away for 20 years I gotta say I'm a full believer now in this in developing a new economy with public-private collaboration so I'm I'm fully fully on board and it's not just USAID and other public sector moving in a direction to understand and support private capital it's the other way around as well I mean the right the reason we're here the reason there's three thousand people at Soul Cap is because a private sector is recognizing it it's not all about shareholder value it's about stakeholders it's about creating a society in a better world and so thrilled that that we're able to to to come together one thing I would encourage if I may say so I'm in as much as you can work together with with with the DFI's with your DFI with OPEC there there may be ways that USAID resources and OPEC capital can move together to more efficiently drive more private capital into the target field sectors countries etc yeah I think I mean I would echo the the excitement on the initiative and having had a similar you know experience you know first interacting with USAID and you know Afghanistan almost a decade ago and you know really seeing a real change in how they look at and want to work with private investors and private capital I think it's really exciting I think you know maybe two challenges of the potential platform is I think one is just an education challenge so I think right now the collaboration not just you know with USAID and the private sector but in this sector as a whole is very personality driven and there's a need for people to sort of build a common language because you know the development community comes into these challenges with a very different language than a private investor and you know sometimes people don't realize that they actually have the same shared outcomes in mind but they're talking about it in very different terms and you do have people in the development community who historically have thought of profit as a dirty word as profit as something that should be avoided and so I think there's a need you know to build that sort of network of champions that can help advocate and show the potential that these solutions have the other just I think you know cautionary thing is you not everything is appropriate for a blended finance solution you know not every road should be a toll road and also there's a need to be precise about the types of concessionary finance and the rates that are appropriate and it can be very different you know situation to situation I think there can be a tendency to fixate on leverage and say oh we put in one public dollar and we got you know 20 private dollars involved but that might be in a relevant metric it might be very easy to achieve that in South Africa and in fact that transaction would have happened anyway without any development support and you might have a one-to-one ratio where you spend a dollar just to get one private dollar into something in Sierra Leone and that can be you know completely valuable and fully additional so I think it's important that we you know calibrate our language should not just sort of use blended finance as a loose term and just sort of thinking of it as you know similar in every context but you know calibrated to the level of risk and the level of transaction costs for the given opportunity so let me ask one more question and then we'll come to the audience there's a great group of folks here and I'm sure you all have questions so I'd love to hear sort of the things that you're thinking about in any of your response to this but so I think one of the big goals of this as it is for a lot of activity that's represented here at Socap is mobilizing private capital it's getting to those groups that are not here at this conference may not even know that it exists and thinking about how they can get engaged in this work and get involved in the emerging market so as you think about invest as a platform and I open this to any of you who want to add comment what are some of the design elements or what are some of the features of this platform that you think would be most effective or could be more successful and happening and looking to achieve that goal of getting more private capital into the market so I could I could say a couple of words about that first of all I really do appreciate Jake's comments about you know it's not all about blended capital right I mean in general I feel that development is about expanding the pie there is still a use for grants there is a use for commercial investment and then there is use for blended capital and I think that to the extent that we could use this platform to really build the knowledge of what are the appropriate solutions at the appropriate time in the appropriate context and create some sort of a roadmap for for example for other donors to also use it would be incredibly catalytic to the entire industry to moving this industry further because right now I feel a little bit it's leading with the solution before you really understand the problem sure so so for example you know here we're talking to a fund immediately we start talking about first loss but maybe first loss is not what's most catalytic maybe what's most catalytic in that situation is a slide card facility or it's a guarantee and I think that forming ways and models that we can learn from and really communicate to other donors of how to figure out where your resources the most catalytic in the right context with the right partners and publishing those tools and those approaches would be would be incredibly helpful scaling up this concept of donor supporting blended capital so I'm hoping that in addition to of course catalyzing lots of transactions and lots of investments and lots of innovative solutions in the sectors I mentioned I really do hope that this platform serves as a convening place as a knowledge base those kinds of approaches. It's great. Anything that the rest you want to add on that. I just encourage innovation and secondly collaboration working with with others serving as a platform is great but it only works if if people are coming to that platform and if every sovereign development agency wants to be the platform it's it's probably not going to be highly efficient so working together collaborating with others is going to be critically important. Yeah I think the speed element which I think is you know structured into this new mechanism is really important you know again our original experiences with USAID you know both on the on the sort of structured investment vehicle and some of the advisory work was sort of you know two years from that first conversation where you say oh this is really interesting let's work together to when it actually came to fruition which you know is a long time in the in the world of private investment and I think you know for a lot of private investors they'll just move on to other opportunities and so that that ability for the development community understand that the private sectors is moving at a different pace and needs to be more nimble I think will be critical for this. Sure. Did you want to add anything. Yeah just a quick comment I would also like to say thank you Jake for just pointing out that blended finance is not always the solution we remind ourselves that in the DCA office guarantees are not always the solution USAID is an agency full of highly technical professionals in terms of public health experts education experts I think probably Agnes you're up against the same thing when we try to tell the story about private capital they're like what why would we try to bring private capital to the public health space and often that is correct that is still an area for grant financing. So we I think this is an opportunity for us to think always very carefully about the right what the right intervention is as you said Agnes but then on the other hand we have examples where absolutely we have something that should be funded through private capital through a more sustainable intervention we recently guaranteed the women's livelihood bond which was put together by impact investment exchange out of Singapore it was listed on the Singapore stock exchange it was it raised funds for for MFI's and impact enterprises across Southeast Asia it's been very hard to explain to certain parts of the agency why accessing the capital markets was so critical in that context and why it was possible and why it's a good model. So I think that we as we continue to do things like that we will we will be able to learn from them as an agency and then I think another you asked before about success what a success look like through invest is just serving as a model for other donor agencies and likewise them for us and what they're doing but I think through this specifically serving as that model. Yeah great. We're working with the Canadians. I will add that for contact information because we've talked a lot about it. First of all I we have another panel to go to but I'll leave my cards here so first of all please feel free to reach out to me. Second you can reach out to any of the partners here. Tideline convergence cross boundary and DAI Bridget is here from the AI so I'm going to ask the people maybe to stand including the USAID folks who are here. So you know who to approach and get their card if you're interested in finding out more. So here are the people. My cards will be here as well but please reach out to them and and we will be happy to put you in contact how to become part of this network. Yeah. So I think we have a bit of time for questions if anyone's got them I see a handle. I don't even have to worry about this. You guys are awesome. Okay. So there is a mic as we've got one here. Very brave soul who went first and then we'll try and catch as many as we can in the next 10 minutes or so. Thank you. My name is Mike Shanley I'm with Connected we're a USAID advisory firm. We help organizations to work with USAID and I'm curious what your thoughts are with the new administrator Mark Green in there. How his priorities are if he's already made some statements on this or how his activities might might affect this space. So we haven't really been given any new priorities. I mean as a development agency we're obviously continue the kind of work that we've been doing. We are obviously supportive of the priorities of new administration and we're looking really forward to starting work. I mean he just joined a couple of months ago. We have not and I think he's really been learning a lot. He did a great trip to Kenya and Sudan where he really focused on humanitarian assistance. So we have great hopes for what's to come and what we're going to be able to do but I don't think we have any new priorities to share at this point. Great. Next question. Take one over here and we'll come to this side. Right here. Thank you. Hi good morning great panel. My name is Laura Darcy I'm with working with ADB in Papua New Guinea on trying to get some solar farms put in on a power purchase agreement so PVP basis and so Gerhardt your point about FX risk is very relevant to what we're facing at the moment but there's another risk that I'm very interested to know whether you had any or developing any products for and that is the payment risk. So the off-taker in these cases is the utility and as you know in these countries the utilities are you know financially quite fragile. There is no the government's not willing to make any sort of sovereign guarantee so we're looking to to see what's been done in other countries to try to address payment risk in these cases. Great. And if the folks on this side want to raise their hand and have questions then Mike can make its way over. Go ahead Gerhardt. I mean I can easily talk about that talk about that at length because it's one type of risk that we capture through the DCA guarantee so especially under power Africa Obama's power Africa initiative we are doing more more you know PPA sort of financing of projects like this and we you didn't ask about the currency thing but we typically do try to find a local lender to support this we don't have foreign currency risk but on the payment risk if we can't find the Ministry of Finance guarantee sovereign guarantee on the off-taker then it's a risk that we will cover as the US government it doesn't we don't automatically just say sure we'll take Papua New Guinea's risk but we will do a full analysis will provision accordingly but it's exactly the type of arrangement we would get into. I just also there are some existing you know other DFI's and product lines that address that risk we've worked with the Africa trade and insurance agency for instance to ensure not just public credit risk but also private credit risks and I think you know part of what this mechanism can hopefully do is is you not necessarily fund everything itself but be that sort of glue and grease that can point out that there's already existing instruments in the market that you know investors might not be aware of that can help address some of these things. The World Bank provides this kind of guarantee and the other way to mitigate that risk to some extent because it is a huge risk and the power Africa we face in every single country is really to build the capacity of you know the distribution companies to show investors that they can actually manage the inflows of revenue because that's usually one of the that's why everybody's asking for a guarantee because they don't trust the management of the revenue that's coming in from the power so I think that that's a really good way of trying to mitigate that risk. Great question thank you let's see we had some hands over here. Hi my name is Duncan Gromko I work on a climate smart agribusiness investment and I used to work at a DFI the IDB on a blended finance product so very interesting talk. I want my question is about the the level of concessionality that you provide in blended finance and how do you choose the appropriate level especially my concern is that public money can be used to kind of subsidize private investment and maybe make private investment more profitable than it would have been otherwise so I see this problem of subsidy and that you can also kind of distort private markets through blended finance so my question is just how do you minimize the level of concessionality or ensure that the level of concessionality is appropriate thank you very much. It's a very important and hard question. I think we get that question every day. I think every development agency gets this question. Yeah, it's very difficult I'm not going to pretend right I mean this is not it's not a science. I think the most important thing is to understand the sector that you're in understand the partners that you with and understand the local context and really this is what I mentioned about the need for knowledge management and for modeling and for really giving donors some checklist some sort of structures that others have tried where they've addressed this and try to learn from that and build on it is really cheap because I don't believe that this has really been solved and it's a question that that really still remains I don't know if you have some thoughts on that. Yeah I haven't come across any scientific way of doing that I would just venture to say that as little as possible to catalyze as much as possible obviously you know there's a place where that crosses I would also say that in many cases it's the perception of risk that holds people away not to not the actual risk. Most of the people that run pension funds across America couldn't find Nigeria on a map that means Nigeria is a huge risk for them if they and so in fact where do we all make money in the market because we know what we're doing and the people that that don't stay away and so that's the difference between real risk and perception risk is where the profit in the market is and so what what this blended capital to your question can do in many cases is help capital become familiar with that sector that market whatever and once it's familiar the blending of capital won't be necessary anymore. Yeah there for a period of time and I would just offer as well I think you know and I know the folks on the stage would agree with this having been part of transactions like these but you know the collaboration and transparency between different types of partners and finding the same language is super important to sort of get to that point of putting as little in to get the most capital out because it's really hard because obviously everyone wants to do what's in their own economic self-interest and I know that one of the other there's a number of sort of parallel efforts happening around this topic around blended finance and convergence and timeline are doing some really interesting work here to support some of this but conversations amongst the development agencies around how they can standardize and try to come up with a set of rules or guides for how they themselves can sort of manage this type of blending capital in a way that will mobilize but is sort of efficient for them from a balance sheet perspective. And I'm sorry, go ahead. Yeah, I was going to add sorry, just a couple more things because on the guarantee side, it's very clear answer to that question, which is that first our guarantee is unfunded. So by definition, our partner is funding the loan that we are guaranteeing. So it's all their own capital. It's almost always a 50 50 risk sharing agreement. So we have as much on the line as they do. So we're not taking 100% or even the majority. And then the third thing is that we charge fees. So we know that if they're going to make the loan without us, they would they would not they would not partner with us because we actually we charge fees. I would say they are slightly concessionary compared to other guarantors. But but it means that they would not make the loan without us. We are actually getting them over the hump of accepting this risk. And as you said, really hoping for some sort of demonstration, what's the perception of risk is taken away? Yeah, I like the perception arbitrage point. But I think it's important to remember that, you know, the alternative usually to blended finance is pure grants and pure grants can be very distortive to markets. We've tried, we've done some work in Haiti, and that is a market that is widely distorted by a surplus of free money sloshing around. In Afghanistan, for instance, at the height of the surge, you know, there were certain provinces and districts where USA or other donors were dumping basically the entire previous GDP of that province in a couple months in grants. And that created not only distortions of the market, but new power brokers, the opportunity for rent seeking. So I think blended finance is hopefully a step in a direction where it's saying there's a lot of things where, you know, just a pure grant can be distortive and uncompetitive. I also think into the point on knowledge management, that sort of honesty and transparency is very important. You know, sometimes successful companies and investors hide the subsidy part. You know, they might have success with a blended finance instrument, but then they make it seem like it was purely commercial. Or vice versa, they take something that could be commercial and make it seem like it desperately needs subsidy. And that creates distortions as well. To pick a sector that we've done a lot of work in, mini-grids, you know, you have people talking about mini-grids in sub-Saharan Africa as if they're fully commercial and can be private today, and people saying that they have to be fully philanthropic and given away. And that takes, and that's creating distortions that make it possible for investors and entrepreneurs to be taken advantage of. So it's important to not get too far ahead of the hype and say, oh, this is fully private now, or conversely, you know, use sort of game the system and try and make this perfect case for subsidy. We can have time for maybe another question or two if there's still some. We have some up front for our poor micriner who's standing in the back. Keep your hand up so he knows where to come find you. Thank you. Hello. Hannah Apricot with permaculture magazine. I'm wondering if any of your groups are familiar with permaculture and working with any, in particular, with local economic development and regenerative ad? You said permaculture, right? If there's any experience working with that and what that might look like, if so. I'm from Canada. I know permafra. Permaculture. We're not invested in any of that at the moment. Yeah, sounds like a no familiar with anything. I'd love to find out. Okay, great. I'd love to talk to you. It's a system looking at how to integrate, connect all the dots for sustainability, but really to take it further so that you're regenerating the soil, producing more food, less inputs, amazing success stories, especially in Africa. Okay, great. Sounds like a should definitely follow up. You can educate all of us. Let's go for this question here. Hi, my name is Alicia Phillips Mandeville. I'm from Interaction, which is a coalition of you American nonprofits that work all over the world. And I'm curious to know many of our member organizations are large organizations that have their own revenue stream and are increasingly developing ways of looking at the way they use their capital base through investments or other instruments. And when I hear people talk about this, they typically think of investors as either people or companies. And so I just be curious to hear if you think differently about or see a space for nonprofit investors who are increasingly operating at scale and with great sophistication. And if you see them already, I'd love to hear about it. If you don't see them already, I'd love to hear how you think about that evolving. Great. Yeah, no, that's definitely where we're defining investors very broadly because of this trend, which I think is great because a lot of the nonprofits have amazing expertise on the ground and know very intimately the needs of the beneficiaries that we're trying to reach. So I think the trend of using endowments and using some of their own capital to actually invest alongside of the programs is a very positive one. And we're very open to working with them. And we are talking to a few, a few large NGOs already. So that's a really great point. So I think we have time for this young, this gentleman right here has had his hand up. So we'll give you, as long as it's a really good concise question. I can try and be good, but I'm not sure I can be concise. I'm with a great African food company, which is a Tanzanian based organization that works with smallholder farmers in communities where world vision operates. And we've been looking into blended finance. But the problem is most of what you're talking about involves an investment in capital with a low return. And the blend brings a low return up to a higher return. For us to serve communities that are very remote, it's not just about capital, it's about operating cost that is at a loss. So it's a business that's going to lose 10% to 20% every year, forever, and will never make a profit. However, if USAID went in, the alternative is to just deal with this community with donations. So it's a much more efficient way to get into a positive outcome. But it doesn't seem to be financeable with any of the types of products you're talking about. I'm wondering whether there's a way you can see to blend in this sort of situation. So I think that it's a great example of the kind of things that we would love to be able to support to invest. Because the problem that you're articulating not only needs some investors to come in and for some donors to provide a subsidy, but it actually really needs some creative solution around what a financial product might look like. And I think drawing on the expertise of others who maybe have some ideas or maybe have deployed similar solutions in other remote areas in other countries is really what we're looking for. So through this invest platform, we're not just looking to work with capital providers and help those capital providers make loans or make investments. We are looking for that knowledge and creation of solutions, kind of co-creation of solutions. So it's a really, really good. It's exactly what we're looking for. So we'd love to follow up. So let me just, so we can give everyone a little bit of time to make it to the next meeting. If the rest of you have done so cap the way have, you've been late for everything. So you're going to be on time for the next thing, I promise. So I just, on that point, just to sort of finalize this Agnes, you sort of, you pointed out all the people that folks in this room can come to with ideas. Like what kind of ideas are you looking for? What's going to be most useful in the coming weeks and months to really make investors sort of crystallize in a way that will achieve some of the objectives you mentioned? Right, so just to summarize, we're looking at the sectors that USAID supports. We support multiple sectors. The main sectors are really health, agriculture, education. We're looking for people who are looking to invest or have invested in those sectors in the countries where we are present. If you look to our website, you will see all our missions in all the countries where we work. So it's quite extensive. We're also looking for people who have innovative solutions that may apply to those countries, but actually are not working there yet and are looking to connect with others through this platform that may be working in those countries and may be able to create partnerships to support those solutions. So once again, we're not just trying through this platform to simply give out more grants or catalyze more capital. We are really looking to connect people that may not be working together yet but could potentially through this network connect and really have a much bigger impact in the sectors and regions where we're working. So if you're an investor, if you have innovative solutions in those sectors, please come see us and see if you're interested in becoming part of this network. And once again, please reach out to us. I'll leave a whole bunch of cars here, take my card and I promise I will put you in touch with the right people to connect and talk to you. Thank you. And thank you for this opportunity really. It's an amazing opportunity to talk to a crowd of potentially new and exciting partners. Yeah, so thank you all for the attention. Thanks to SoCat for having us and please join me in giving the panelists a warm applause. Thank you. Thank you.