Access the report here.
TCX protects public and private sector borrowers in frontier and emerging markets from financial volatility emanating from currency risk. We also support capital market development, mobilize private investor interest, and advocate for structural adoption of local currency financing solutions.
TCX offers currency risk solutions that essentially convert hard currency development lending into lending linked to the local currency. This way, borrowers still receive hard currency but are not impacted by movements in the exchange rate. Their debt service repayments become stable and predictable.
As a development finance initiative, TCX pursues maximum development impact and does not compete with commercial banks. We are active in currencies, tenors and sizes where commercial alternatives are absent or inadequate.
Our development impact framework encompasses three pillars.
Pillar 1: De-risking development finance
TCX absorbs the currency risk of hard currency loans to emerging and frontier market borrowers. This increases the risk-resilience of impact generated by these investments and their corresponding contributions to the UN SDGs.
Pillar 2: Supporting capital market development and mobilizing the private sector
TCX shifts part of the currency risk it takes on its balance sheet to private participants in the international financial markets. Building partnerships with development finance institutions and connecting commercial investors with frontier markets generates lasting capital market development.
Pillar 3: Advocating for local currency finance and currency risk protection
TCX plays a crucial role in advocating for large-scale adoption of local currency finance and hedging. The local currency ecosystem expands through partnerships with international institutions, policy setters, donors, and local parties in developing countries.
TCX measures its expected impact through a set of defined indicators. Featured case studies, interviews, and stories of borrowers further amplify TCX’s reach and development impact.
Please find a digital copy of the 2022 Impact Report here.