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brown eld projects (see by way of example, Eskom in South Africa, which has stated that the DFIs are to form the ‘backbone’
of its capital raising in the next  ve years). Similarly, many DFIs have A-grade credit ratings which enable them to source capital on more competitive terms.
2. Quality and experience: Beyond providing  nancial support, DFIs have a developmental mandate which transcends pure funding, and are also actively engaged in creating enabling environments to address regulatory and institutional challenges.
DFIs can also provide support in respect of complex commercial transactions and can assist in the contribution to local government capacities i.e. by assisting with negotiations, conducting feasibility studies and providing access to external legal and technical resources.
3. Risk mitigation: The impact of DFIs can be crucial especially in the early stages
of a green eld project, which is often accompanied with high levels of risk, uncertainty and lack of private investment. DFIs o er a multitude of risk mitigation products which help to attract private sector capital. Examples of this include inter alia the International Finance Corporation Partial Credit Guarantee for credit enhancements and the AfDB Currency Exchange Fund for hedging of currency and interest rate risks.
The need for a solid foundation
The 2016 McKinsey Bridging Global
is a partner in Baker McKenzie’s Banking & Finance Practice based in Johannesburg. She
has considerable experience in advising on general banking and  nance mandates.
is a partner in Baker McKenzie’s EMI Practice based in Johannesburg. He has over 25 years’ experience working in South Africa and Africa, with particular focus on energy and infrastructure projects.
is an associate in Baker McKenzie’s Banking & Finance Practice in Johannesburg. She focuses on corporate structuring,  nance, project contracting and regulatory issues.

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