Washington — Heads of state, finance leaders and activists from around the world will gather in Paris this week to seek ways to reform the world’s development banks – such as the International Monetary Fund and the World Bank – and prepare them to face a hot and stormy world. Can get help
While debt restructuring and reducing poverty will be part of the summit on Thursday and Friday, climate will be the main driver, with representatives from developing countries in Africa, Asia and elsewhere having a prominent seat at the table.
The World Bank and IMF have been criticized for not factoring climate change into lending decisions and being dominated by wealthy countries such as the US, where the countries most at risk of global warming have avoided calling the shots. .
While those are the primary problems to be solved, some doubt that the spectacular summit, led by French President Emmanuel Macron, will be able to take major steps to address those challenges.
Nevertheless, the summit for the New Global Financing Pact will be attended by around 50 heads of state and government – representing more than 100 countries – from Germany, Brazil, Senegal, Zambia and more.
Barbados Prime Minister Mia Mottley will play a major role as a leader of the Bridgetown Initiative, a plan to reform development debt by freeing up funds after climate disasters and targets the high borrowing costs and debt faced by developing countries. Countries have to
US Treasury Secretary Janet Yellen, Chinese Premier Li Qiang, new World Bank President Ajay Banga, IMF Managing Director Kristalina Georgieva and climate activists Greta Thunberg and Vanessa Nakate are also set to attend.
Masood Ahmed, president of the Center for Global Development think tank in Washington, isn’t expecting much concrete action from the gathering, but a broad agreement that “we have to think much bigger, much bolder. We need to be ready to change.” Is.”
Ahmad, a former senior official at both the IMF and the World Bank, said, however, that it is difficult to summon the political will to spend taxpayer money to tackle climate change.
For example, “In the United States, we don’t have the kind of support in Congress today that you would want for a major global initiative on climate,” he said. “That makes it difficult for people to translate a sensible strategy, a necessary strategy, an important set of actions into legislative action that puts money on the table.”
French organizers want to show they can fight poverty and meet the challenges of climate change at the same time, said a top French official, who is authorized to nominate publicly according to the country’s presidential policy. had not been.
Organizers say the summit will end with a summary of commitments, including a roadmap for what to expect from this year’s meeting of the Group of 20 major economies and a UN climate conference.
But climate advocates say they want to see more meaningful commitments — such as new money to help climate-sensitive nations build sustainable infrastructure or reallocating existing funds to new climate-related projects. .
Andrew Najdin, director of activist group Glasgow Actions Team, said development banks “need to step up their lending – and fast – if we are going to avoid the worst effects of the climate crisis.”
A US Treasury official told The Associated Press that big new monetary pledges should not be expected from the summit – rather it is seen as an opportunity to push the case for development banks. The official spoke on condition of anonymity to preview the plan for the gathering.
Earlier this year, the World Bank announced that it would increase its lending by $50 billion over the next 10 years to combat extreme poverty and mitigate and adapt to climate change.
The World Bank is trying to push back on comments from former President David Malpass who cast doubt on the science that burning fossil fuels causes global warming. He stepped down this year amid criticism and was replaced by Banga – who is attending his first major international meet since taking the helm.
The World Bank and IMF did not immediately comment.
Yellen, for her part, has called for the inclusion of climate finance since at least 1997, when she chaired the White House Council of Economic Advisers. She has been vocal about the need to reform multilateral banks and bring low-income countries into the conversation.
He described climate change as an “existential crisis” that no country can fight alone.
“We must help developing countries move their economies away from carbon-intensive energy sources and increase access to clean energy,” she said last October.
Justin Mankin, a Dartmouth climate scientist, hopes that those at the summit will take into account the inequalities that climate-sensitive countries face and avoid reinforcing them.
Mankin said, “I would argue that to advance growth in a world where global warming has already happened, those inequalities have to be taken on,” and the fact that developing economies are in a foot race, which against rich countries. Also catches massive amounts of pollutants and wallet strings.
Because global development banks tend to favor large industrialized nations, the conditions attached to climate aid should not be unduly harsh, he said.
“What conditions these banks impose on countries is one way of knowing whether these disparities can be reined in,” Mankin said.
More specific reform proposals are expected in the next few weeks from a G20 panel created to recommend changes to the IMF, World Bank and other global development agencies, said Ahmad, a former IMF and World Bank official.
One of the biggest challenges will be bringing together countries with divergent interests and growing geopolitical tensions between the US and China.
“The combination of these geopolitical tensions, suspicion of globalization and institutions, and only a partial recognition that solving these global problems will cost taxpayers,” Ahmed said.
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Associated Press reporters Seth Borenstein in Washington and Sylvie Corbett in Paris contributed.
