Why focus on lower-middle-income countries (LMICs)?

IFFEd addresses the learning and skills crisis in LMICs, where the needs are greatest

IFFEd targets the massive gap in education financing for LMICs – home to 1.2 billion children and youth – nearly half of the world’s young population. The vast majority are not gaining the basic skills to thrive.

From India to Pakistan, Nigeria to Kenya, some of the world’s most populous countries are LMICs caught in the “missing middle”: they are no longer eligible to receive grants but find non-concessional financing unaffordable. With limited domestic resources, LMICs’ investments in education and skills are often hit the hardest, as countries choose to prioritise more “economic” investments like infrastructure.

The financing gap in LMICs is much too large to be solved by traditional grant aid, which is not even enough to address the needs of the poorest countries. Total global aid for education is currently only around $17 billion, leaving a staggering $71 billion annual financing gap to deliver quality education for all in LMICs.  

IFFEd is designed to address this enormous need. By maximizing scarce donor resources in an unprecedented way, IFFEd allows donors to better meet the financing needs of LMICs affordably, without having to reduce allocations for low-income countries or humanitarian crises.

The G20 recognised IFFEd as one of the most significant development finance innovations in the last decade, as it turbocharges the financing power of multilateral development banks (MDBs) by leveraging a mix of grants and sovereign guarantees in a new way to increase funding for human capital development.

Amidst competing needs for climate, health, and infrastructure , IFFEd enables LMICs to prioritise investments to educate their children and youth – and create a generation of possibilities.