Written statement: British International Investment: 2026–2031 Strategy - April 23

Minister for International Development and Africa (Baroness Chapman of Darlington): I wish to update the House on British International Investment's (BII) new five‑year Strategy for 2026–2031, launched today. BII is the UK's Development Finance Institution, investing in private sector businesses in developing countries to support productive, sustainable and inclusive economic development. Its investments improve peoples' lives and help protect the planet, while making a positive financial return which it reinvests to support even more businesses. BII's portfolio of investees support over 1 million jobs and in 2024 paid $2.5bn in taxes.

The world around us is changing rapidly, reshaped by global instability. Faced with growing global security threats, the Government last year took the difficult decision to reduce Official Development Assistance (ODA) to the equivalent of 0.3% of Gross National Income (GNI) by 2027. We are modernising our approach to development to have the greatest impact abroad and secure the best value for money for taxpayers at home. Our work will be underpinned by a focus on economic development, supporting greater resilience in partner countries and reducing dependencies.

BII's new strategy will deliver on the UK's modernised approach to development. As our main bilateral vehicle for investing in the private sector, BII is central to the UK's shift from ‘donor to investor', partnering closely with countries to unlock growth, jobs, trade, and drive private sector development. BII will also play a key role in delivering UK backed climate investments.

Over the next five years, BII will make £7-8bn in new investment commitments, increasing the proportion of its climate finance investments to at least 40%, and targeting at least 30% of its core investments to improve economic opportunities for women. BII will continue to prioritise investments in Africa, Asia, the Caribbean and Ukraine, delivering investment where it is most needed. BII will invest across a wide range of sectors including financial services; power, trade and digital infrastructure; and sustainable industries – ensuring it can support the varied needs of partner countries. BII will continue to support critical minerals value chains by investing in the enabling infrastructure and supply chains necessary for long‑term, resilient growth.

The Government has agreed three key shifts that will underpin BII's approach over the next five years:

• Focus on what matters most to development – BII will increase its focus on investments which go beyond delivering direct results, to shape and strengthen wider markets to make them work better for the people they serve.
• Sustain UK commitment to Least Developed Countries (LDCs) – BII will commit at least 25% of its new core investments to LDCs. In a smaller number of focus LDCs (Nepal, Sierra Leone and Zambia to begin), BII will strengthen its work by combining policy engagement and technical assistance alongside its investments.
• Accelerate private capital flows in emerging markets - BII will aim to mobilise up to £7.5bn of commercial capital alongside its own investment over the strategy period, including from the UK financial sector. A cornerstone of BII's strategy is the launch of British Climate Partners (BCP), which will direct private investment into the energy transition in select Asian countries by developing and scaling an investable pipeline of transactions.

BII's investments will make a difference for people, businesses, markets and the planet. BII will:

• Back small business growth in Africa and Asia: BII will support 10 million micro, small and medium-sized businesses to get the finance they need so they can grow, innovate, and create economic activity across the countries where we invest.
• Expand economic opportunities in Africa: BII will support jobs and economic opportunities for 10 million people across Africa.
• Drive the shift to clean energy in Africa and Asia: BII will support countries to move to renewable power and strengthen electricity networks – powering 10 million households with clean energy.

The Foreign Secretary's statement of 19 March on ODA allocations confirmed that the FCDO plans on providing BII with £429m in capital over FY26/27 – FY28/29 for its core portfolio and Ukraine investments. BII's £7-8bn of new investment commitments over the five-year strategy will mainly be financed by reflows from its existing investments.

The FCDO has an arm's length relationship with BII. FCDO agrees BII's five-year strategy, including its objectives, performance criteria, and investment parameters. BII's Board is accountable for performance against the strategy, with BII's senior management responsible for delivery. BII's Board members are chosen for their relevant skills and experience, with the FCDO appointing the BII Board Chair and two Non-Executive Directors. The FCDO has full transparency on BII's performance in delivering the strategy through regular formal governance meetings and reporting.