From Dialogue to Scale: Key Takeaways from the Roundtable on Scaling Pension Fund Investment in Emerging Markets through the Development Finance Asset Class

Organised by the Dutch Ministry of Foreign Affairs, Dutch Ministry of Finance, and ILX on the 28th of September 2026

On 28 September 2026, the Dutch Ministry of Foreign Affairs, the Dutch Ministry of Finance and ILX convened a roundtable in The Hague to discuss a central question: How can we scale up institutional investment into emerging markets and developing economies? The discussion brought together pension funds, asset managers, Multilateral Development Banks (MDBs), Development Finance Institutions (DFIs) and government representatives.

The discussion reflected a shared recognition that the opportunity is significant. The conversation is no longer about whether emerging markets offer an attractive investment opportunity, but it is increasingly centred on the practical steps needed to mobilise institutional capital at greater scale. Participants broadly recognised that the building blocks already exist – investment opportunities, growing institutional interest, improving data availability and innovative investment structures – and now it is time to scale.

The Opportunity

Emerging markets continue to offer long-term investors exposure to economic growth, diversification benefits and measurable real-economy outcomes. At the same time, significant financing needs remain across infrastructure, energy, climate transition, financial inclusion and broader economic development. Participants agreed that directing more institutional capital towards these markets is both an investment opportunity and an economic necessity.

Data and Transparency

A recurring theme throughout the discussion was the importance of data and transparency. Investors highlighted the need for reliable and comparable information on risk, return, defaults and recoveries to support allocation decisions. Evidence presented by the Global Emerging Markets Risk Database (GEMs) showed an average annual default rate of 3.54% and an average recovery rate of 72.9% for private-sector investments between 1994 and 2024, helping bridge the gap between perceived and actual risk in emerging markets.

Role of MDBs and DFIs

The evolving role of MDBs and DFIs was also widely discussed. Beyond providing capital directly, these institutions are increasingly acting as catalysts for private investment by originating, structuring and distributing investment opportunities suitable for institutional investors. Their local expertise and networks, risk management capabilities and track record remain essential elements in attracting greater volumes of private capital towards emerging and developing economies.

Standardisation in the market

Another important topic was the need for greater standardisation and portfolio-level access. Many development finance investments remain highly bespoke. Discussions highlighted the value of diversified investment vehicles, repeatable structures and more standardised reporting to make development finance easier to assess, access and integrate within institutional portfolios.

Looking ahead, participants identified several priorities for further action: strengthening the evidence base, developing more standardised investment structures, expanding portfolio-level access, addressing currency and liquidity challenges, building institutional capacity and continuing collaboration across the ecosystem. The conclusion was clear: many of the foundations are already in place. The next step is to turn those foundations into scale.

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