Better Financing

Recent Posts

IDA’s New Fundraising Campaign: An Early Test for World Bank President Banga

June 1, 2023

Last month, the World Bank announced its intention to mobilize $12 billion for a new Crisis Facility for IDA, the arm of the bank that provides concessional lending and grants to the poorest countries.  The Crisis Facility will augment emergency funding for IDA’s most vulnerable borrowers and provide new resources for Ukraine and Moldova. Shareholders will be asked to pledge to the new facility by December 2023, shortly before the start of the next IDA replenishment in early 2024. The proposal reflects a compromise with donors who objected to an accelerated fundraising [...]

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Declaring a Hollow Victory on SDRs Would Further Undermine G20 Credibility

May 23, 2023

In November 2021, the G20 pledged to recycle $100 billion of Special Drawing Rights (SDRs) from advanced economies to more vulnerable countries. While these countries jumped on the moment to offer public promises, they've been slower to deliver on those financial commitments. But it is likely that at the Paris Summit for a New Global Financial Pact on June 22-23, French President Emmanuel Macron will proclaim victory—that $100 billion SDRs have been recycled. Or at least pledged. Or sort of. Whatever he proclaims, it will be premature. Here are a few reasons why the job [...]

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Now Is the Time to Recycle SDRs through the African Development Bank

May 22, 2023

This week, the African Development Bank (AfDB) will hold its annual meeting in Sharm El Sheikh, Egypt. This is the right moment for its shareholders and other donors to commit to allocating some of their excess Special Drawing Rights (SDRs) to the hybrid capital fund that the AfDB has proposed to create with SDRs. The G20’s promise to recycle $100 billion SDRs to vulnerable countries has yet to be fulfilled. The AfDB proposal offers an opportunity to show results. There is no better SDR recycling opportunity for donors. The AfDB plan allows SDRs [...]

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Mustering the private sector for development and climate in the Global South – Is it realistic?

May 11, 2023

The 2015 Addis Ababa “Billions to Trillions” initiative called for stepped-up private sector investments and financial flows in developing countries.  But instead of closing, the “trillion” dollar gap between development and climate needs continues to widen.   Was it a fairy tale? What is certain is that the current operating model of the aid agencies and the development finance institutions, is not helping to crowd-in private flows at the necessary scale.  The paper reviews the evidence and highlights what needs to change and how to do it.  Since the devil [...]

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