“The world is on fire.” These are the opening words of the second volume of a report on strengthening the multilateral development banks commissioned by the G20 and released last week in Marrakech. The heat of 2023 makes that more than a purely figurative statement. We are living in an era of big challenges and an evident inability to meet them. The time left is also ever shorter.
The first volume, published in June, proposed a “triple agenda” for the MDBs: tripling annual lending to $390bn by 2030; adopting a “triple mandate” of eliminating extreme poverty, boosting shared prosperity and contributing to global public goods; and expanding and modernising MDB funding models. This volume explains what this would mean in detail. Put simply, it calls for an overhaul of every aspect of how MDBs operate — the scale of their resources, how they use them, the risks they take, their relationship with the private sector and how they operate.
This call for change is justified. As I noted last week, the economic performance of many developing countries has deteriorated since the pandemic. The number of people in extreme poverty also jumped by 95mn between 2019 and 2022. Meanwhile, enough has not been done to mitigate climate risks. Indeed, enough cannot be done without greatly enhancing the financing available to developing countries. We simply must do better.