Resilient Firms and Economies 2025

Reliable energy, transport and logistics networks are the backbone of any resilient economy. In emerging markets, weak infrastructure raises costs, heightens risks and leaves firms vulnerable to disruption. As disruptions from extreme weather, conflict and supply chain volatility intensify, the Global Risks Report 2025 suggests that strengthening and diversifying critical infrastructure and supply chains is increasingly essential to maintaining business continuity and resilience in a fragmenting global economy.32 Governments and MDBs have been investing in infrastructure for many years. However, their resources alone cannot meet the scale of demand in emerging markets. Mobilizing private capital is therefore essential, but high financing costs, slow deal cycles, currency volatility and policy uncertainty can deter long-term investment and make projects more difficult to deliver. At the 2025 Fourth International Conference on Financing for Development in Seville, participants called on governments and MDBs to scale up public resources to unlock private capital.33 Key proposals included broader use of risk-sharing instruments, local currency lending and blended finance.34 Expanding the financing toolkit, however, is only part of the answer; success will depend on whether these instruments are accessible, practical and aligned with firms’ essential needs. Standardized guarantees to unlock infrastructure finance Standardized, portfolio-based guarantees can help lower the risk premium businesses face when financing capital projects. By providing lenders with greater confidence, guarantees enable longer-term and more affordable financing. Guarantees create real value when they are easy to access. Today, firms and lenders often spend months renegotiating similar risk terms, increasing costs and delaying projects. Standardized guarantee and model term sheets can streamline negotiations, enhance pricing transparency and allow banks and firms to pre-qualify financing portfolios – enabling multiple projects to advance more quickly under a single framework. The World Bank Group’s one-stop guarantee platform, launched in 2024, is an important step in this direction. It unifies products from the World Bank, the IFC and the MIGA under a single-entry point, facilitating access to credit guarantees, trade finance cover and political risk insurance, targeting a tripling of annual issuance to approximately $20 billion by 2030.35,36,37 Looking ahead, MDBs could further simplify guarantee processes by creating a single-entry point across private, sovereign and insurance windows, aligning approval processes and offering portfolio-level options. Such tools would allow banks and corporations to pre-qualify pipelines rather than renegotiate deal by deal. In regions where guarantee mechanisms already exist, new platforms could automatically integrate them. Co-guarantees with instruments such as the EU’s European Fund for Sustainable Development Plus (EFSD+) External Action Guarantee, for example, may help expand overall capacity, align risk-sharing with market standards and unlock additional private capital.38 MDBs are also exploring ways of expanding balance-sheet capacity, such as through exposure exchanges and hybrid capital instruments. These tools can help recycle limited guarantee headroom and channel it towards higher-risk markets where private finance is often most hesitant to engage.39,403.1 Infrastructure and supply chains: foundations of long-term stability MDBs could further simplify guarantee processes by creating a single- entry point across private, sovereign and insurance windows, aligning approval processes and offering portfolio-level options.IDB Invest is having a catalytic role through its Ready and Resilient Enterprises program, which offers a comprehensive approach to strengthening private sector resilience in Latin America and the Caribbean. The initiative combines technical assistance, financial instruments, and public–private collaboration to help firms anticipate and manage climate and disaster risks. By targeting key sectors such as water and sanitation, energy, infrastructure, telecommunications and tourism, and promoting tools like blended finance, climate and natural disaster-resilient debt clauses, and disaster risk-informed procurement, the program intends to enable businesses, particularly SMEs, to make risk-informed investments and become active partners in building long- term resilience.CASE STUDY IDB Invest: building business resilience across Latin America and the Caribbean Resilient Firms and Economies 19