From our Head of External Relations: Updates from the G20 and World Bank / IMF Spring Meetings
At last week’s meetings of the G20 Finance Ministers in Washington DC in the margins of the World Bank / IMF Spring Meetings, conversations continued to drive toward action on debt, reform of multilateral institutions, and sustainable finance and investment for the climate transition. We look toward further progress in each of these areas in the coming months to enable sustainable infrastructure development.
Debt – Given the IMF’s forecast that growth will slow further, there continues to be a high risk of debt defaults in emerging markets. There are ongoing discussions of how to implement the ‘Common Framework for Debt Treatments beyond the DSSI’, as our CEO Marie Lam-Frendo outlined in her update from the last G20 Finance Ministers meeting in February, but so far there have been no major breakthroughs.
Reform of multilateral institutions – There is broad commitment across the multilateral system to the important role played by multilateral institutions like the multilateral development banks (MDBs), development finance institutions, and others – particularly in supporting sustainable development in middle- and low-income countries. Reforms, like the ones contemplated to improve MDBs' ability to enable sustainable and fair growth, are complex but necessary evolutions. All eyes are on the new expert group and the MDBs themselves, who are working to implement the recommendations of the review of MDB Capital Adequacy Frameworks and collaborate on effective systemic reforms.
Sustainable finance and investment for the climate transition – As has been reinforced by the release of the latest IPCC Synthesis Report on climate change, the climate crisis is accelerating rapidly. In every room in Washington last week, there was acute awareness that the climate crisis is accompanied by an investment and financing crisis, as climate and economic issues continue to affect the flow of capital in unprecedented ways. The pressure is particularly on governments as they plan investment within constrained balance sheets and look to find more and better ways to collaborate with the private sector to mobilise private capital. In the infrastructure sector, there is no shortage of sustainable finance solutions, as our Strategic Advisor Denis Crevier recently wrote in his recap of reforms and innovations in infrastructure financing, yet progress here is also not where it needs to be.
As individuals and organisations, we have to remember how important it is to keep progressing.
Although last week’s meetings didn’t see headline-level decisions or commitments from the G20, we continue to be encouraged by the dialogue among multilateral players and the fact that there is a cohesive and clear set of priorities that will enable sustainable infrastructure development. What remains to be done is the hands-on work of coalescing the public and private sectors around the most impactful solutions, and advancing them. As individuals and organisations, we have to remember how important it is to keep progressing. We can’t solve every problem at once, or wait for a solution to be perfect before we roll it out. We have all seen, and the climate crisis demonstrates with increasing urgency, that hesitation in the current landscape will be fatal. Action is essential.
To that end, we’re looking forward to sharing more next week about our work on infrastructure transition pathways and to progressing our work on scaling up private investment in infrastructure and technology solutions for the climate transition. Learn more about these below.