Working paper · CCA-WP 2026-01

DFI Co-Investment Behaviour in Sub-Saharan Africa, 2020–2026

Analytical work in progress — circulated to practitioners and researchers for comment before formal publication.

1. Why co-investment behaviour matters

Development finance institutions occupy a structurally unusual position in African capital markets. They are mandated to invest where commercial capital will not, yet judged increasingly on how much commercial capital they draw in behind them. That dual mandate — additionality on one side, mobilisation on the other — makes their co-investment behaviour the single most important variable in how private capital reaches African businesses.

For an entrepreneur or a fund manager, the practical question is narrower and sharper: when a DFI is present in a transaction, a sector, or a market, does that make private capital more likely to follow — and if so, through what mechanism? The answer determines whether the right sequencing of a raise is to secure a DFI anchor first, or to assemble a commercial syndicate and bring the DFI in to fill a gap. This paper assembles the public evidence on that question for Sub-Saharan Africa over 2020 to 2026, a period spanning the COVID capital retreat, the 2022 venture correction, and the debt-led recovery of 2025–26.

2. The scale of the flow

In 2024, multilateral development banks and DFIs reported record private-finance mobilisation of $278.5 billion globally, of which $108.7 billion was for middle- and low-income countries.¹ These are the headline numbers the sector reports against, and they are genuinely large. But three qualifications matter before any of it can be read as a signal for African private markets.

First, the totals are dominated by a small number of large multilateral institutions. An earlier mapping of nine DFIs covering $45 billion of Sub-Saharan commitments to end-2019 found that three multilateral DFIs — the IFC, the AfDB and the EIB — accounted for more than 65% of commitments.² Concentration at the top means the ‘behaviour’ of DFIs in aggregate is really the behaviour of a handful of institutions.

Second, the flow is weighted heavily toward debt over equity, toward dollar and euro denomination over local currency, and toward financial institutions, energy and extractives over other sectors.² The mobilisation headline is not evenly available across the capital stack: an early-stage equity business in a frontier sector sees a very different DFI market than an infrastructure debt platform.

Third, and most important for African allocators: much of the recorded mobilisation happens at the portfolio or platform level rather than deal by deal. Over a third of the IFC’s private-capital mobilisation in FY25 came from loan syndications.³ That is mobilisation, but it is not the co-investment-into-a-single-company pattern that a growth business is looking for when it seeks a DFI anchor.

3. The mobilisation ratio problem

The ambition captured in the phrase ‘billions to trillions’ rests on an assumed multiplier: that each public dollar pulls several private dollars behind it. The realised ratios in Sub-Saharan Africa fall well short of that assumption.

The clearest single data point comes from energy, the most DFI-intensive sector on the continent. For every dollar disbursed by DFIs into energy-related fields between 2016 and 2022, only around 33 cents was mobilised from the private sector.⁴ That is a mobilisation ratio below 0.4:1 — an order of magnitude short of the 3:1 or 4:1 leverage the blended-finance thesis assumes, and the inverse of the ratio often quoted as the goal. Where the higher ratios do appear, they tend to be in specific, well-structured transactions rather than across a portfolio.

The gap between ambition and realisation is not evidence that DFIs fail. It is evidence that the mechanism by which DFI capital draws in private capital is more subtle than a direct co-investment multiplier — which is precisely what the most recent econometric work suggests.

4. The catalytic-signal effect — the most important finding

The strongest recent evidence reframes the entire question. A panel study assembled in late 2025, tracking DFI commitments and private capital investment — private equity, private credit, venture capital and infrastructure finance — across 54 countries from 1994 to 2025, finds that private capital investment increases following periods of sustained DFI engagement, even in the absence of contemporaneous co-investment.⁵

This is a materially different claim from the mobilisation-ratio framing. It says the primary channel through which DFIs crowd in private capital is not the individual syndicated deal but the signal that sustained DFI presence sends about a market’s investability. Three features of that study sharpen the point for African allocators:

• The effect is larger where multiple DFIs operate simultaneously — a market with several active DFIs is read by private investors as more validated than one with a single institution present.
• The effect is larger where DFI activity is concentrated across sectors and where DFIs are active in the same country–industry segments as private investors — presence in your specific segment matters more than presence in the country generally.
• Strikingly, increases in DFIs’ narrative attention to Africa precede expansions in their activity, and, with a lag, higher private capital investment. What DFIs say they will prioritise leads what they fund, which in turn leads private capital.

For a business raising capital, the implication is not ‘get a DFI into your round’ but ‘raise in a segment where DFIs are visibly and repeatedly present’. The DFI does not have to be in your deal to make your deal more fundable.

5. What the disclosure data reveals — and hides

Any empirical claim about DFI co-investment is constrained by what the institutions disclose, and this is where the working-paper caveat bites hardest. Disclosure is improving but remains partial and uneven.

On the positive side, it is now possible to view and analyse a comprehensive record of the UK DFI British International Investment’s private-capital-mobilisation data spanning 2012 to 2024, and the French DFI Proparco and the Swedish DFI Swedfund have moved in the same direction.⁶ Where this transaction-level data exists, it allows exactly the kind of behavioural analysis this paper calls for: which instruments, which sectors, which co-investor types, over time.

On the negative side, the coverage is holed. German bilateral agencies such as DEG have redacted most fields — constrained, in fairness, by national banking-secrecy law — and most multilateral development banks redact heavily too.⁶ There is no consistent typology of the private parties mobilised, which is the single field that would most help an allocator understand who actually follows DFI capital into African deals. The result is that the best behavioural data comes from the most transparent institutions, which are not necessarily the largest by commitment — a selection bias any honest reading has to carry.

6. Sector and instrument concentration, 2020–2026

Within the period under review, DFI appetite has visibly concentrated. Across 2025, renewable energy and climate-resilient infrastructure absorbed the largest share of concessional and blended finance, with transport, digital connectivity and private-sector development consolidating as core focus areas.⁷ The European Investment Bank’s development arm, EIB Global, deployed €3.1 billion in Africa in 2025, roughly a third of its worldwide envelope, with nearly 46% of the Africa portfolio directed toward climate action.⁷

A parallel and underappreciated development is the rise of African-led financing vehicles. The Africa Finance Corporation surpassed $1 billion in revenue for the first time in 2024 and made capital mobilisation its defining 2025 theme, co-launching a $1.5 billion infrastructure financing facility with AUDA-NEPAD.⁷ For the catalytic-signal thesis this matters: the ‘multiple DFIs present’ condition that most strongly draws in private capital is increasingly met by African institutions alongside the traditional multilaterals.

The concentration cuts both ways for a business raising capital. If you operate in energy, climate infrastructure, transport or digital connectivity, you are in the segments where DFI presence — and therefore the catalytic signal — is strongest. If you operate outside them, the signal is weaker and the sequencing of a raise has to work harder to compensate.

7. Implications for sequencing a raise

Read together, the evidence points to a sequencing logic that differs from the intuitive ‘land a DFI anchor first’ approach:

• Segment selection precedes syndicate design. Because the catalytic effect runs through sustained sector presence, the highest-leverage decision is whether the business sits in a segment where multiple DFIs are repeatedly active. That is a strategic-positioning question, not a fundraising tactic.
• A DFI in the round is a structuring tool, not a validation stamp. The data suggests private capital is already more willing to enter DFI-active segments; the specific reason to bring a DFI into a given transaction is what it does to the risk structure — a first-loss layer, a guarantee, a local-currency tranche — not the signalling, which the segment already provides.
• Expect a documentary standard set by the most disclosed institutions. The DFIs whose data is public are also those whose diligence is most standardised; a business seeking their capital should prepare to that standard rather than to a local commercial-lending standard.
• Watch narrative before activity. Because DFI narrative attention precedes funding, a business can read published DFI strategy documents as a leading indicator of where capital will be available in twelve to twenty-four months, and position accordingly.

8. Limitations and the fuller study this anticipates

This is a working paper, and its limits should be stated plainly. It rests on aggregated and institution-level public data, not a transaction-level dataset of its own; the disclosure gaps described in section 5 mean the behavioural picture is drawn disproportionately from the most transparent DFIs. The mobilisation-ratio evidence is clearest in energy and cannot be assumed to hold identically across sectors. The catalytic-signal finding, while drawn from a rigorous multi-decade panel, is an association whose causal mechanism — signal versus unobserved common driver — the source study itself treats with appropriate caution, and so should any reader.

A fuller study would assemble a Sub-Saharan-specific, transaction-level panel joining DFI commitments to subsequent private-capital entry at the country–sector level, distinguishing genuine co-investment from sequential entry, and classifying the private parties mobilised. We circulate this working paper to practitioners and researchers precisely to test the framing before committing to that larger data build, and welcome correction, challenge, and additional data.

References

1. MDB Task Force on Mobilization, Mobilization of Private Finance by MDBs and DFIs 2024 (Joint Report), 2026.
2. Eighteen East / MOBILIST, The Exit Mobilisation Opportunity in Africa, 2025 (mapping of nine DFIs, $45bn Sub-Saharan commitments to end-2019).
3. Publish What You Fund, Is the MDB Joint Report on private capital mobilisation sliding into irrelevance?, June 2026 (IFC FY25 loan-syndication share).
4. International Energy Agency, The role of development finance institutions in energy transitions, 2024 (energy mobilisation ratio, 2016–2022).
5. Parwada, J. T., Where Two or Three Are Gathered: Collective DFI activity and private capital entry in Africa, SSRN, December 2025 (panel of 54 countries, 1994–2025).
6. Publish What You Fund / IFI Working Group, DFI transaction-level disclosure scorecard (BII 2012–2024; Proparco; Swedfund; DEG redactions), 2026.
7. Prospect Intelligence, What DFI Financing Strategies Reveal About Africa’s Development Priorities, March 2026 (2025 sector concentration; EIB Global; Africa Finance Corporation).