Investing in fragile and conflict-affected settings (FCAS) presents unique opportunities for investors to drive financial returns and social impact. Rising and unmet demand for renewable energy makes this a profitable investment prospect. In FCAS markets, renewable energy projects are desperately needed and can play a transformative role: building local skills, generating tax revenue for governments to deliver basic services, increasing land security, rebuilding energy markets, and improving energy access as an engine of inclusive socio-economic opportunities. Renewable energy projects align with the Sustainable Development Goals (SDGs), the Just and Green Transition and Environmental and Social and Governance (ESG) objectives, hitting several objectives for investors and investees. However, these markets face significant investment barriers.
One key message from investors is that investing in FCAS is often perceived as too complex and expensive, requiring innovative approaches and deep country-specific knowledge that investors cannot easily access. Some investors are exploring ways to build business in FCAS, but these efforts have largely remained ad hoc, requiring substantial effort with high transaction costs. The challenge lies in moving beyond one-off ventures toward a systemic, scalable investment approach—shifting from proof of concept to building a robust pipeline of bankable projects.
One solution is peace positive investment, which is an emerging approach to manage risks andimprove returns for investors in FCAS. Meeting the goal of tripling renewable energy capacity by2030 faces an investment gap of up to US$400 billion annually between 2024-30 – at least half of which is in emerging markets¹. Addressing this shortfall in FCAS would unlock enormouseconomic and social opportunities, improve peace and security and enable transformativedevelopment outcomes while attracting further investments
