The central message from the dialogue was that local currency finance is no longer a niche technical concern, but a test of whether the development finance system can adapt to the realities of the economies it seeks to support.
The opportunity is transformative because it is not only about changing the currency of individual loans; it is about changing the terms on which risk, resilience and investment are shared between international institutions, domestic markets and end borrowers.
The next phase should therefore be defined by implementation. The building blocks exist, but they remain fragmented across institutions, instruments and markets. The task now is to align shareholder mandates, MDB treasury reform, specialist risk-sharing platforms, domestic market development and data into a coherent delivery agenda.
Realising that opportunity will not just require better instruments. It will require sustained political will, institutional leadership and coordination across the full range of actors whose decisions shape how currency risk is created, priced and allocated.
With that collective effort and by building on the connections already made, local currency finance can move from a set of important but standalone solutions to a core pillar of a more resilient and equitable development finance architecture.
Amaan Manji and Joshua White
Wilton Park | September 2026
List of Acronyms
- Multilateral Development Bank (MDB)
- Foreign Exchange (FX)
- Hard currency (HCY)
- Emerging markets and developing economies (EMDE)
- Development Finance Institutions (DFI)
- Local currency (LCY)
- International Monetary Fund (IMF)
- Inter-American Development Bank (IDB)
- Official Development Assistance (ODA)
- Private Sector Window (PSW)
- Small-Medium sized enterprise (SME)
- Non-Bank Financial Institution (NDFI)
- Financial Sector Assessment Programme (FSAP)
A table of referenced LCY Models is included in the annex to the report and can be viewed in the PDF version downloadable below.
In partnership with
Notes
Wilton Park reports are brief summaries of the main points and conclusions of a
conference. The reports reflect rapporteurs’ personal interpretations of the proceedings.
As such they do not constitute any institutional policy of Wilton Park nor do they
necessarily represent the views of the rapporteur. Wilton Park reports and any
recommendations contained therein are for participants and are not a statement of policy
for Wilton Park, the Foreign, Commonwealth and Development Office (FCDO) or His
Majesty’s Government nor any participating governments.
Should you wish to read other Wilton Park reports, or participate in upcoming Wilton Park
events, you can find out more here.
To receive our monthly bulletin and latest updates, please subscribe here.