President, Members of the Executive Board, Excellencies, colleagues, and friends,

Good morning.

I am pleased to present the 2024 Annual Report of the UN Capital Development Fund, along with a cumulative review of the first three years of our Strategic Framework (2022–2024).

Let me begin by thanking the President of the Board, His Excellency Mr. Andres Montalvo Sosa, for his leadership, and Mr. Haoliang Xu, UNDP Associate Administrator, for his continued support. I would also like to recognize Mahsa Jafari, Secretary of the Executive Board.

When I addressed you last year around this time, I was in my job for two months. Since then, UNCDF has undergone a strategic restructuring—driven by audit recommendations and evaluations—to strengthen its role as a capital providing fund, first and foremost to the Least Developed Countries we serve in line with the General Assembly resolution of 1966, which was further updated in 1974.

Today, UNCDF is reinvigorated to fulfill its unique role in the UN Development System: channeling supplementary capital to countries that are farthest behind in their development aspirations. UNCDF is presently one of only two UN entities that can provide financial derisking with appropriate instruments needed to stimulate underdeveloped markets.

What makes UNCDF different, and to date underleveraged, is that unlike AAA-rated financial institutions that can not handle more than a 1% expected loss—UNCDF can. Why? Because we do not borrow, we have no balance sheet to protect. Our role is to absorb risks that others in finance cannot easily do, and to catalyze development finance that otherwise would escape communities in last-mile conditions.

The renewed focus of our mission is simple but vital. To reduce financial risks to unlock investments where capital traditionally doesn't flow.

This means lifting early-stage innovators and small businesses and fueling economic growth and prosperity for underserved communities in high-risk markets.

In today’s context of declining Official Development Assistance, this mission is more critical than ever. According to Convergence, less than 5% of global financial assets are invested in developing countries, with only a fraction of that making its way to Least Developed Countries and low-income countries, many of which are in Africa and Small Island States. UNCDF exists to change that.

As we prepare for the Fourth International Conference on Financing for Development, UNCDF stands ready to help rethink how development finance can reach the last mile—and how to truly crowd-in private capital for development.

UNCDF exists to do exactly that.

Cumulative results, 2022–2024

Our results give reason for optimism.

UNCDF has positively impacted the lives of nearly 30 million people in underserved areas. We enabled access to energy for off-grid communities, expanded digital financial services to unbanked individuals and businesses, and supported climate risk management in vulnerable regions—from small island states to rural Africa.

In just three years, we have supported over 500,000 micro-, small-, and medium-sized enterprises, exceeding our strategic target. These are job creators in frontier markets and critical in areas with young populations.

Our catalytic use of grants, loans, guarantees, and technical assistance has helped mobilize over $780 million in additional investment against an annual core that has been less than $10 million.

We are now better positioned to complement the UN Development System and multilateral banks—aligned with the 2024 QCPR resolution that calls for greater coherence, synergy, and complementarity among development actors.

Examples of impact, 2024

Let me share two examples of what this looks like in practice.

In Nigeria, we have partnered with UNICEF to combat childhood malnutrition by investing $2.5 million in a local producer of therapeutic foods. It is not the amount that is important, but what it has done. This not only saves lives but also stimulates local agriculture, creates jobs, and reduces reliance on imports, thereby reducing the burden on foreign reserves, which are scarce.

In Afghanistan, UNCDF, UNDP, and the Resident Coordinator’s Office deployed a $1 million financial guarantee to unlock more than $7 million in capital for hundreds of SMEs—critical in a country where SMEs employ 90% of the workforce.

Challenges and institutional priorities

To fully realize UNCDF’s potential, we must address three key issues:

First, we need to scale-up our capital investments. In 2024, only one-quarter of our resources were deployed as loans or guarantees. This needs to change it needs to be much higher. We have adopted new investment policies and are working to strengthen our digital systems, using AI and blockchain technology to be able to deploy smaller amounts of capital more frequently—and faster. In crisis settings, which we are working on with UNDP’s Crisis Bureau, our goal is to deploy capital in 21 days—making us one of the fastest-moving capital providers to MSMEs in fragile contexts.

Second, we need to strengthen our fiduciary oversight in line with our growth ambitions. Our core contributions accounted for less than $7 million, still far short of the $25 million target that the Board has endorsed. Core funds now make up just 6% of our total resources, constraining our ability to be strategic and responsive. We also have success in our non-core contribution of $112 million. I seek the support of the Board to unlock additional core and non-core resources, so that we can augment support to LDCs. I know this is difficult to ask, but it is critical.

Third, we are relocating closer to where we operate. We’ve streamlined our footprint—reducing staff from around 500 to below 350 and consolidating operations in Nairobi, Dakar, Bangkok, and across key LDCs through our partnership with UNDP.

We’re also in dialogue with Member States about potentially relocating our headquarters to further strengthen partnerships with DFIs, impact investors, and donors who have historically invested the most in UNCDF including the EU, Germany, Sweden, Switzerland, the UK and Norway.

Looking ahead

Now, please allow me to share some thoughts on the path ahead.

We have started consultations for our 2026–2029 Strategic Framework. This next chapter will reflect your, Member States’, demand for a catalytic vehicle to mobilize private sector finance in difficult and challenged markets, first and foremost in LDCs. It will define our role not as a competitor to the MDBs/DFIs—but as an enabler of a broader development finance architecture where money flows to where it is most needed.

I am encouraged by the growing recognition of our unique value. UNCDF is now working with partners such as UNDP, UNICEF, WFP, IFC, Mitsubishi UFG Financial Group, Standard Charter, and insurance leaders like Aon and Lloyd’s. We are also advancing our EU Pillar Assessment—on track to become the second UN entity to access the EU Gateway for the deployment of guarantees.

We have momentum—but to meet the scale of the challenge, UNCDF must be properly capitalized with larger volumes of flexible, unearmarked resources.

This is a moment of transformation—not just for UNCDF, but for how the UN system meets the needs of the world’s most vulnerable economies. As the Associate Administrator has noted, a dollar invested in UNCDF is recycled, leveraged, and multiplied—reaching where others cannot.

Closing

Excellencies,

I end by thanking the EB for your steer in these formal settings, as well as outside. I would also like to reiterate an appeal for your continued support—financing, advocacy, and strategic collaboration—to help LDCs unlock their potential through UNCDF’s catalytic mandate.

I also thank the staff of UNCDF for their perseverance over the last 12 months. As Nelson Mandela once said: “It always seems impossible until it’s done.”

Thank you for your confidence in UNCDF.