British International Investment (BII), the UK’s development finance institution and a leading impact investor, has revealed that it will take on an anchor investor role in the newly introduced Allianz Credit Emerging Markets Fund. The fund is designed to accelerate the flow of climate finance into emerging markets, with roughly 40% of its capital earmarked for deployment in Africa. The remaining investments will be allocated across other developing regions.
Funding will target a wide spectrum of climate‑aligned sectors, including renewable energy generation, clean and sustainable transportation, climate‑smart agriculture, and financial services that support green growth. Structured as a blended‑finance vehicle, the fund brings together a consortium of public and private sector partners. Development finance institutions will collectively contribute $150 million in concessionary, junior‑tranche capital.
This catalytic layer is intended to absorb risk, reduce volatility, and strengthen return prospects, thereby encouraging greater participation from commercial investors. If the fund achieves its final close target of $1 billion, private investors are expected to provide up to $850 million in the senior tranche.
BII has committed $40 million to the initiative and will invest alongside several other international development partners, including Global Affairs Canada, IDB Invest (the private sector arm of the Inter‑American Development Bank), the Swedish International Development Cooperation Agency (Sida), and Impact Fund Denmark.
The announcement coincides with the fund’s first close, which has secured commitments totaling $690 million to date. Allianz SE and GastroSocial Pensionskasse will act as anchor investors for the senior tranche.
Baroness Chapman, UK Minister for International Development and Africa, said:
BII’s participation in the ACE fund demonstrates how we are modernizing our approach to international development, by working as partners and investors.
We are using UK government support to attract more private investment to create a bigger impact – ensuring every pound we invest generates much more funding for countries in the Global South to tackle the climate emergency. This approach helps Britain too, boosting growth, bringing in investment and returns for UK taxpayers and positions us as a key hub for helping emerging economies.
Leslie Maasdorp, Chief Executive of BII, said:
At BII we recognize that we must use our scarce concessionary capital to unlock the vast pools of private finance that is required to meet the global challenge of the climate emergency and drive sustainable, impact-led growth in some of the least developed countries in the world. Today’s announcement is another milestone for BII in achieving that key objective.
BII’s investment in the ACE fund is the third to be announced through its £100 mobilization facility, launched by Sir Keir Starmer, the UK Prime Minister, in 2024. The first announcement was for an anchor investment in the Pentagreen Green Investment Partnership, to support green and sustainable infrastructure projects in South-East Asia. The second was a partnership with BlueOrchard on a groundbreaking blended finance fund designed to unlock life insurance capital for climate finance.
Edouard Jozan, Head of Private Markets, AllianzGI, said:
Addressing climate change cannot be focused solely on investing in developed markets – launching ACE is a bold step forward in mobilizing institutional capital to address global development priorities including climate. This strategy is a great example of the strength and power of collaboration between the public and private sector and the significant potential for further scale in this asset class. Leveraging our longstanding partnerships with DFIs and MDBs, we aim to deliver investors with both attractive returns and measurable positive outcomes.
