MDBs Explore Ways to Adapt to Changing Global Economic Landscape “Remaining Relevant in a Fast Changing World”
Adapting policy and strategy to the changing global economic and financial landscape is the major preoccupation of representatives of multilateral development banks (MDBs), who concluded their two-day annual forum on Wednesday in Tunis.
The African Development Bank’s first Vice President and Chief Operating Officer, Emmanuel Mbi, underscored the importance of the meeting on the theme “Remaining Relevant in a Fast Changing World” as an opportunity for the MDBs to discuss critical issues germane to their work.
“You will agree with me that the global setting has in the last few years undergone tremendous changes in the economic, social and even political spheres,” Mr. Mbi said.
He cited the most recent changes to include the prevalent global economic crisis and its pervasive impact on the world economy; the slowdown in the large emerging economies such as India, China and Brazil; and high global food and energy prices.
The changes also highlight the high but unbalanced growth rates recorded in developing countries where Africa accounts for both seven of 10 fastest-growing economies and six out of 10 most unequal societies in the world, Mr. Mbi said.
He cited the demand for accountability from governments spurred by pervasive inequality, which started with the Arab Spring in Tunis, as a reminder “that our challenge in this part of the world is much more than scaling up currently good growth performance,” but must also take the well-being of vulnerable people into account.
Participants in the forum discussed ways of harmonizing and adapting their institutions’ policies and strategies to the changing global landscape in terms of financial instruments, credit policies, rating of MDBs, support to middle income countries, and decentralization.
“Within this fast-evolving landscape, MDBs are expected not only to remain responsive, but also to demonstrate results. It is critical, therefore, that we continuously innovate and remain relevant to the needs of our clients,” Mr. Mbi added.
The AfDB, he said, was now focusing on the jobs, inclusion and safety-nets nexus to ensure that people benefit from, and are protected by, economic growth.
However, this would require greater strategic control in the mobilization and use of resources given the graduation of countries such as India, Nigeria, Ghana and Vietnam, which would dramatically increase demands for non-concessional resources in the face of contracting aid budgets.
“The changes that we are witnessing have emphasized the imperative of cooperation of multiple actors to respond to their common threats,” he said.
For his part, Mr. Sakai Kazu of the Asian Development Bank urged participants to examine a number or areas where the MDBs would find convergence.
It has become imperative to move away from the lineal rich-poor to a multiple approach to development thinking and action.
Mr. Birama Sidibe of the Islamic Development Bank suggested that since the MDBs had become part of the global credit risk equation, they would have to find innovative ways of pulling private and public funds together to pursue all-inclusive development.
The World Bank, Asian Development Bank, European Bank for Reconstruction and Development, European Investment Bank, and the Islamic Development Bank were represented in the forum hosted by the AfDB.