2023 IMF and World Bank Annual Meetings: Multilateral Development Banks Pledge to Strengthen Financing Capacity for Greater Impact | African Development Bank Group

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Leaders of multilateral development banks (MDBs) participating this year in the annual meetings of the IMF and the World Bank in Morocco have committed to strengthening their individual and collaborative actions to accelerate inclusive socio-economic development.

To achieve greater impact, the institutions agreed to explore innovations to increase financing capacity, boost climate action, strengthen co-financing and catalyze private sector engagement.

MDBs represented at Friday’s meeting included 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, the Inter-American Development Bank, the Islamic Development Bank and the New Development Bank. and the World Bank Group.

The 2023 Annual Meetings will take place in the Moroccan city of Marrakech, the first time in Africa after 50 years, and at a time when developing countries, particularly those in Africa, urgently need more development finance to help alleviate strained public budgets and growing debt levels. .

“To meet the challenge, we reiterate our commitment to undertaking crucial reforms to strengthen our financing capacity, increase the speed and agility of our operations, and improve the way we work together to maximize our impact as a system,” declared the institutions. » said Friday after a meeting.

Banks said they had identified capital adequacy framework measures which, with strong contributions from shareholders and development partners, could potentially generate $300-$400 billion in additional credit headroom over the next decade .

MDBs, working in collaboration with other development partners, can offer considerable leverage, deep knowledge and expertise, and unprecedented proximity to governments and those who need it most.

They noted that progress toward achieving the Sustainable Development Goals (SDGs) has been “agonizingly slow,” while climate emergencies have intensified around the world, hitting the most vulnerable hardest.

“We, the leaders of the multilateral development banks, recognize the collective role we must play in response to global challenges and the efforts that will put us on the right path to achieving the SDGs,” they stressed, noting that a global effort significantly increased is needed to eradicate poverty, accelerate inclusive socio-economic development and address cross-border challenges.

At their recent meeting in New Delhi, G20 leaders noted that on 21st The century requires a fit-for-purpose international development finance system, placing MDBs at the center of solutions to global challenges. They recognized the need for “better, bigger and more efficient MDBs”.

African ministers present at the Marrakech meeting welcomed the G20 recognition, saying they took the vote of confidence with great responsibility and pledging to intensify their individual and collective actions.

A strong African voice

Speaking at various sessions at the Annual Meetings, African ministers spoke with one voice on the continent’s call for recalibration of the global financial infrastructure to help developing countries, including those on the continent, to meet current global economic challenges.

African ministers reaffirmed Africa’s common position by calling for reforms within the IMF to make it better able to provide essential liquidity and strengthen the global financial safety net. They also reiterated the need to reform the IMF Special Drawing Rights (SDR) system, the global debt architecture, the IMF quota formula and to amplify Africa’s voice and representation. .

They also stressed the need for action on the SDR issue, which they said had been on the table for more than two years. Additionally, they called on donors to finalize their financing commitments to the IMF’s Resilience and Sustainability Trust (RST).

Fixing the “dysfunctional” global financial system

In an essay published by the New York Times ahead of the Marrakech meetings, Kenyan President William Ruto, African Union Commission Chair Moussa Faki Mahamat Faki and African Development Bank Group President Dr. Akinwumi Adesina , jointly argued for The “dysfunctional” global financial system must be fixed.

The authors cited that during the Covid-19 pandemic, rich countries injected billions of dollars into their economies to support families and businesses. African governments had no such option.

“Instead, their leaders kept their nations afloat by taking on more debt, which proved to be a very expensive life raft. Due to rising interest rates, Africa’s debt repayments will reach $62 billion this year, an increase of 35% from 2022,” the authors said.

The African Development Bank delegation to the World Bank/IMF Annual Meetings was led by the institution’s Senior Vice President, Bajabulile Swazi Tshabalala, representing the President of the Bank Group, Dr Akinwumi Adesina.

Read the Joint Declaration in full here.

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