British International Investment (BII) has committed $40 million as an anchor investor in the Allianz Credit Emerging Markets (ACE) fund – a landmark $1 billion blended finance vehicle aimed at scaling climate finance across emerging markets, with Africa set to receive around 40 per cent of total disbursements.

The fund, which has reached close to $690 million, combines concessional capital from development finance institutions with private investment to reduce risk and crowd in institutional capital.

DFIs and multilateral development banks will provide $150 million in junior capital, while private investors are expected to contribute up to $850 million at final close.

BII is joined in the junior tranche by Global Affairs Canada, IDB Invest, the Swedish International Development Cooperation Agency and Impact Fund Denmark.

Allianz SE and GastroSocial Pensionskasse are anchor investors in the senior tranche.

The ACE fund is expected to become one of the largest blended finance vehicles globally, targeting climate-aligned investments in renewable energy, clean transport, agriculture and financial services across Africa and other emerging markets.

Chief Executive of BII, Leslie Maasdorp, said the investment reflects BII’s strategy of using scarce concessional capital to unlock large pools of private finance needed to address climate change and support sustainable growth in developing economies.

Head of Private Markets at Allianz Global Investors, Edouard Jozan, said the fund demonstrates the power of public-private collaboration in mobilising institutional capital beyond developed markets while delivering both competitive returns and measurable climate impact.

The ACE commitment is BII’s third investment under its £100 million mobilisation facility, launched in 2024 to accelerate private capital flows for climate and development outcomes.