Raising the FfD4 Zero Draft Ambition: Towards a UN-member states led MDBs reform

Thu, Feb 13, 1:15-2:30PM NY-time 

CR-D (in-person only) 

Moderator: Roos Saalbrink, Action Aid International

Speakers:

• Mahinour ElBadrawi, CESR

• Jiten Yumnam, Centre for Research and Advocacy of Manipur

• Rodolfo Bejarano, LATINDADD

The current international public finance architecture is clearly failing to provide necessary resources for countries to finance their developmental needs. According to the dominant narrative, public finance is inherently insufficient, and thus requires promotion of private finance to advance sustainable development. Most rich countries that dominate decision-making on ODA flows through the OECD and Multilateral Development Banks (MDBs) have supported the increasing use of scarce concessional finance to leverage private finance, including blended finance and public private partnerships. 

 This dominant approach promoted by both rich countries and MDBs, however, raises concerns on unequal benefits, unintended impacts, measurement, and regulation. While rich countries and multilateral institutions promote private finance-centric approaches, they evade their own public finance commitments for development and climate needs. 

 As acknowledged by the FfD4 Zero Draft, private investments on sustainable development have not met expectations. Capital markets remain short-term oriented and volatile. Profit-seeking motives and obligations of private finance actors and investors are inherent misaligned with the SDGs. FfD4’s outcome must enshrine a stronger focus on the regulatory role of Member States, driving an agenda for private business and finance engagement in the SDGs that is alignedwith democratically determined national development strategies, and in support of the structural transformation in the Global South. 

 This event will be a space to discuss potential proposals to support such regulatory and developmental role of the state, including via the promotion of sustainable industrial policies, the establishment of an intergovernmental process to evaluate in a comprehensive way the impact of blended finance and other tools dedicated to leverage private finance as a way of identifying the best possible toolkit of policy measures to regulate in the public interest, and on bringing UNGA leadership to the role of IFIs/MDBs by initiating a UN intergovernmental process to review and transform the governance and mandate of International Financial Institutions and Multilateral Development Banks, towards more inclusive, transparent, accountable and democratic institutions, with a rights-centered approach to development and a focus on public investment and ownership of public goods, responsive to national and regional dynamics.