DFI commitments by instrument
Except for the CDC, most DFIs’ commitments are in the form of debt. This reflects the nature of project finance for energy and infrastructure projects. DFIs also lack the internal structures and resources to provide substantial oversight that direct equity investments require. However, many DFIs have successfully been making equity investments by taking minority stakes; and in some cases, DFIs have invested both debt and equity into the same investee. Many DFIs have indirect equity exposure through their investments in private equity funds. Overall, equity investments are generally smaller than debt investments. In the case of the CDC, 74% of its commitments are in the form of direct and indirect equity, while OPIC is one of the few DFIs that does not offer equity and the only DFI that provides political risk insurance.
Note: Indirect equity includes investments in private equity funds and other includes guarantees and political risk insurance.