MARRAKECH: The independent expert group on strengthening multilateral development banks (MDBs) has made a case for quicker decision making by these entities, less risk aversion and getting more private capital, said N K Singh, the co-chair of the panel.
The second volume of the report “Bigger, Bolder, Better” is due to be presented to G20 leaders on Thursday but Singh said that several MDBs had started initiating action on the recommendations with the World Bank seeking approval from its board of governors on Thursday. He, however, said that the World Bank and other agencies needed to fix targets on private capital, just like steps taken in other areas.
The panel, set up by India under its G20 presidency, had estimated an annual requirement of $1 trillion for countries to meet the needs of combating climate change and other challenges, of which half was to come via concessional and non-concessional lending with the rest from the private sector. Another $2 trillion will have to come from domestic sources.
The expert group had also recommended the setting up of a Global Challenges Fund to tap into money that is available in the system and can be used to address the requirements of countries seeking funding.
At a meeting of the Emerging Markets Forum here, Singh said that the idea was to get MDBs to nearly treble their annual lending from around $120 billion to close to $400 billion and make them bigger. “The challenge is how do you harness risk factors to get more private capital,” he said.
He said quicker response to proposals, by reducing the average time (24-26 months) to process proposals and disburse loans to around 12 months will help them make better, along with steps to ensure that the MDBs work together to meet the requirements of countries.
Singh said that the independent expert group has suggested several steps to make MDBs bolder, including the use of innovative financing tools.
The second volume of the report “Bigger, Bolder, Better” is due to be presented to G20 leaders on Thursday but Singh said that several MDBs had started initiating action on the recommendations with the World Bank seeking approval from its board of governors on Thursday. He, however, said that the World Bank and other agencies needed to fix targets on private capital, just like steps taken in other areas.
The panel, set up by India under its G20 presidency, had estimated an annual requirement of $1 trillion for countries to meet the needs of combating climate change and other challenges, of which half was to come via concessional and non-concessional lending with the rest from the private sector. Another $2 trillion will have to come from domestic sources.
The expert group had also recommended the setting up of a Global Challenges Fund to tap into money that is available in the system and can be used to address the requirements of countries seeking funding.
At a meeting of the Emerging Markets Forum here, Singh said that the idea was to get MDBs to nearly treble their annual lending from around $120 billion to close to $400 billion and make them bigger. “The challenge is how do you harness risk factors to get more private capital,” he said.
He said quicker response to proposals, by reducing the average time (24-26 months) to process proposals and disburse loans to around 12 months will help them make better, along with steps to ensure that the MDBs work together to meet the requirements of countries.
Singh said that the independent expert group has suggested several steps to make MDBs bolder, including the use of innovative financing tools.