The main multilateral development banks (MDBs) signed a series of commitments this Saturday to continue working in a coordinated manner, as reported in a statement. The agreement includes greater financing to confront climate change, incentives to mobilize the private sector in strategic projects and up to $400 billion more for loans.
The directors of the ten major MDBs met at an informal meeting organized by the Inter-American Development Bank (IDB) in Washington, on the occasion of the end of the spring meetings of the International Monetary Fund (IMF) and the World Bank (WB). . .
“We have just held, at the IDB headquarters, an unprecedented retreat with all the leaders of the MDBs,” explained Ilan Goldfajn, president of the IDB. With the commitments adopted, which Goldfain describes as “pioneering”, the development banks seek to “deepen collaboration to work as a system. Together we are working to better serve our countries and achieve greater impact and scale with our actions.”
The meeting included the leaders of the IDB, WB, the African Development Bank, the Asian Development Bank, the Asian Infrastructure Investment Bank, the Council of Europe Development Bank, the European Bank for Reconstruction and Development, the European Investment Bank , Islamic Development Bank and the New Development Bank.
Measures for five areas
Today’s commitment focuses on proposals in five areas considered critical and includes increasing financing by up to $400 billion over the next decade with the support of shareholders and partners. The banks also propose the implementation of new hybrid capital and risk transfer instruments, as well as promoting the channeling of Special Drawing Rights (SDR) from the IMF through the MDBs.
The MDBs commit to continue working on harmonizing procurement processes to reduce costs and increase their efficiency, as well as accelerating co-financing in public sector projects. Development banks will also work to conduct joint impact assessments and monitoring and increase local currency lending and currency risk hedging solutions to boost private investment.
To support the fight against climate change, the MDBs will deliver a first common approach to measuring climate outcomes on adaptation and mitigation and will continue to align their projects with the Paris Agreements to address global warming. The agreement adopted today is one more step in the commitment adopted between the MDBs last year in Marrakech to improve the response of these multilateral development financing and technical assistance institutions to face the planet’s new challenges.
