The Global Emerging Markets Risk Database (GEMs) Consortium is a collaborative initiative of 29 multilateral development banks and development finance institutions, pooling 40 years of credit risk data from their lending operations in emerging markets. The database provides publicly accessible statistics at no cost through platforms such as gemsriskdatabase.org, Bloomberg, and Data360, helping both members and the wider public better understand investment risks in these markets.
Founded in 2009 by the European Investment Bank (EIB) and the International Finance Corporation (IFC), the GEMs Consortium has evolved into a community of practice that standardizes data methodologies for recording default and recovery statistics. It offers valuable insights into the performance and potential of emerging markets. The Consortium is governed by a Steering Committee co-chaired by the EIB and IFC, with senior representatives from major multilateral banks including the EBRD, IBRD, AfDB, ADB, and the IDB Group.
Emerging markets require substantial investments in physical and social infrastructure, such as energy, transport, digital connectivity, health, and education. Historically perceived as high-risk, these markets can now be better understood using GEMs data, which separates perceived risk from evidence-based reality. Access to default and recovery rates of MDB and DFI loan portfolios allows investors to more accurately assess risks and mobilize private capital alongside multilateral institutions where it is most needed.
Recent GEMs publications from October 2025 highlight that default rates in emerging markets are comparable to those of non-investment grade firms in advanced economies, while recovery rates exceed global benchmarks. Specifically, annual default rates for private lending average 3.54% with a recovery rate of 72.9%, public lending defaults average 2.61% with an 85.8% recovery rate, and sovereign or sovereign-guaranteed lending sees defaults of 0.77% and recoveries of 95.1%.
GEMs members, including the African Development Bank, contribute data to the Consortium and utilize GEMs statistics to inform their risk models. The EIB Secretariat is actively exploring how GEMs data can support its own risk modeling to ensure fair and effective outcomes for emerging market clients.
Overall, GEMs demonstrates that investing in emerging market firms carries lower risks than often perceived. Even during global crises, default rates in emerging markets were lower than in advanced economies, providing diversification benefits. Sovereign risk ratings tend to overstate corporate default risks, indicating opportunities to channel domestic savings into private sector projects. Mobilizing finance alongside MDBs and DFIs increases the likelihood of experiencing default and recovery outcomes similar to those recorded by GEMs.
