UNDP and Berne Union Sign MoU to Unlock Billions in Sustainable Investment for Developing Nations

UN officials say the partnership reflects a broader shift in international development strategy: moving beyond traditional aid models toward large-scale mobilization of private finance.

In a major step toward reshaping the future of global development finance, the United Nations Development Programme (UNDP) and the International Union of Credit and Investment Insurers (Berne Union) have signed a groundbreaking Memorandum of Understanding (MoU) designed to channel significantly greater volumes of trade and investment finance toward sustainable development priorities across emerging and developing economies.

The strategic alliance comes at a critical moment for the global economy, as developing nations grapple with an estimated US$4.3 trillion annual financing gap needed to achieve the United Nations Sustainable Development Goals (SDGs) by 2030. With rising debt burdens, tightening fiscal space, geopolitical instability, and declining levels of official development assistance, policymakers and financial institutions are under increasing pressure to mobilize private capital at unprecedented scale.

The new UNDP–Berne Union partnership seeks to address one of the most persistent barriers to investment in developing markets: risk.

By leveraging export credit agencies (ECAs), political risk insurers, reinsurance mechanisms, and blended finance structures, the collaboration aims to reduce uncertainty for investors while accelerating capital flows into sectors critical for sustainable growth, including renewable energy, resilient infrastructure, sustainable supply chains, and climate adaptation.

The agreement marks a significant evolution in the role of trade and investment insurance — traditionally viewed as a commercial safeguard — into a strategic instrument for global development and climate resilience.

A New Era for Sustainable Trade and Investment Finance

Under the MoU, UNDP and the Berne Union will work jointly to strengthen the contribution of export credit agencies and investment insurers to sustainable economic transformation, particularly in countries where investment risks have historically constrained development.

The collaboration will focus on expanding the use of:

• Political risk insurance

• Sovereign and sub-sovereign guarantees

• Reinsurance structures

• Blended finance mechanisms

• Risk-transfer solutions for foreign direct investment

The partnership also seeks to establish stronger sustainability standards and impact-reporting frameworks to ensure that trade and investment flows generate measurable developmental outcomes.

Among the key priorities identified under the agreement are:

• Mobilizing investment into clean energy and low-carbon infrastructure

• Supporting climate-resilient transport and logistics systems

• Enhancing sustainable manufacturing and supply chains

• Strengthening investment environments in emerging markets

• Improving governance standards and sustainability reporting practices

• Developing country-level and regional financing initiatives

The two organizations will also launch analytical and programmatic initiatives aimed at increasing investor confidence in high-impact sectors where financing remains insufficient despite growing global demand.

Unlocking Private Capital at Scale

UN officials say the partnership reflects a broader shift in international development strategy: moving beyond traditional aid models toward large-scale mobilization of private finance.

"Export credit agencies and political risk insurers play a significant role in shaping global trade and investment flows," said Marcos Neto, UN Assistant Secretary-General and Director of the UNDP Bureau for Policy and Programme Support.

"Through this partnership, we aim to better align risk-sharing instruments with national development priorities and the 2030 Agenda, helping unlock sustainable investment at scale."

According to UNDP, investment uncertainty — especially around political stability, regulatory consistency, and institutional implementation capacity — remains one of the largest deterrents preventing private investors from entering frontier and emerging markets.

The organization believes that improving risk mitigation mechanisms can unlock substantial new flows of private capital into economies that are most in need of sustainable infrastructure and climate financing.

Since 2022, UNDP says its policy support and nationally led reforms have helped catalyse more than US$900 billion in SDG-aligned public and private finance, highlighting the growing importance of innovative financial instruments in achieving global development targets.

Berne Union Members Back US$140 Billion in Annual Capital Flows

The Berne Union — the world's leading association for the export credit and investment insurance industry — represents institutions that collectively support approximately US$140 billion in long-term capital flows to developing countries each year.

Its members include export credit agencies, multilateral development banks, and private insurers that facilitate cross-border trade and investment by providing insurance and guarantees against commercial and political risks.

Industry experts say the partnership with UNDP could significantly deepen the developmental impact of these financial flows by integrating sustainability metrics directly into investment risk frameworks.

"UNDP plays a key upstream role in addressing policy risk, regulatory uncertainty, and government implementation capacity in emerging economies," said Yuichiro Akita, President of the Berne Union.

"By helping create conditions where risks can be assessed and priced, UNDP enables Berne Union members — ECAs, private insurers, and MDBs — to originate and structure projects more effectively."

Akita added that stronger information exchange and operational cooperation between the two organizations could generate new downstream investment opportunities for Berne Union members while accelerating sustainable development outcomes.

The partnership is expected to move rapidly from framework discussions into operational engagement, with early collaboration already planned around investment opportunities in Central Asia during the Berne Union Astana Spring Meeting in May.

Sustainable Finance Becomes Central to Global Development Strategy

The agreement underscores the growing role of sustainable finance as a cornerstone of the UNDP Strategic Plan 2026–2029, which positions financial system reform as a key accelerator for achieving inclusive economic growth and climate resilience.

Global development institutions are increasingly recognizing that public budgets alone cannot finance the transition to sustainable economies. Instead, international organizations are focusing on creating financial ecosystems capable of attracting institutional investors, sovereign wealth funds, insurers, and private banks into development-oriented projects.

Analysts note that political risk insurance and export finance are becoming increasingly important in sectors such as:

• Renewable energy deployment

• Green hydrogen projects

• Critical minerals and battery supply chains

• Climate-resilient agriculture

• Sustainable transportation corridors

• Digital infrastructure in underserved regions

By integrating sustainability priorities into risk assessment and investment guarantees, the UNDP–Berne Union collaboration could help lower financing costs and improve access to long-term capital for developing economies.

Building More Resilient Financial Systems

Beyond mobilizing investment, the MoU also reflects a broader ambition to create more resilient and coherent global financial systems capable of responding to climate shocks, economic instability, and geopolitical disruptions.

Both organizations emphasized that the partnership is non-exclusive and designed to encourage wider collaboration among governments, multilateral institutions, insurers, investors, and development finance actors.

The initiative arrives amid growing international concern that progress toward the SDGs is slowing, with many developing countries facing worsening debt vulnerabilities, inflationary pressures, and climate-related disasters.

Financial experts say innovative public-private risk-sharing partnerships such as this may become increasingly central to future development finance models.

As global institutions search for scalable solutions to bridge the SDG financing gap, the UNDP–Berne Union alliance signals a decisive move toward leveraging insurance and guarantee markets not merely as financial protections, but as catalysts for sustainable transformation.