The Danish government is launching new investment fund aimed at fulfilling the Sustainable Development Goals
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Denmark is establishing new fund to support the UN's Sustainable Development Goals. The fund will be launched in 2017 in the shape of a new innovative partnership between the Danish state, the Investment Fund for Developing Countries (IFU) and institutional investors.
"We must have a strategic approach to our development aid, and therefore we are thinking the Sustainable Development Goals into our business policy. Development aid can support a sustainable development while at the same time opening up new markets for Danish export," the Danish priminister Lars Løkke Rasmussen says.
The objective is a capital base of 4-5 billion Danish kroner. Thus, venture capital is secured for the realisation of projects that presuppose further financing from other investors as for example Danish businesses, local banks, investors, foundations etc. IFU assesses that for each million kroner the fund invests the total project investments will constitute almost 6 million Danish kroner. Therefore, the new foundation is expected to contribute to investments for up to 30 billion Danish kroner towards 2023.
The Danish government sets aside 100 mill. Danish kroner in 2017
The Sustainable Development Goals foundation will aim to invest in reaching the goals with sustainable and rentable projects within the fields of, amongst other things, climate, energy, water and sanitation, food, health, production and service. It will create growth, jobs and tax revenues in the development countries, while the areas also match the strengths of the Danish business community.
The government will set aside 100 million Danish kroner for the foundation in 2017, and this will be followed up with further appropriations in 2018 and 2019. The foundation is also expected to receive funds via state guarentees. The majority of the capital basis is expected to come from institutional investors.
4.5 billion dollars annually is necessary to reach the 17 Sustainable Development Goals by 2030. The global development aid only make app. 132 billion dollars a year.
The foundation will be administered by IFU and follow IFU's policy on sustainability based on the UN's Global Contact and the UN's guidelines for businesses and human rights - amongst others. A systematical reporting of how the concrete investments contribute to the relisation of the Sustainable Development Goals will take place. The foundation can invest in almost 150 countries that have been categorized as development countries by the OECD's comittee on development. Thereby the foundation covers almost all African countries and Latin America and also the majority of the countries in Asia and a few countries in Europe.