The International Monetary Fund and the World Bank Group (IMF-WBG) are gearing to reform themselves as a response to heightening crises of our generation. At the Annual Meetings last 9 to 15 October, the institutions brought together states, multilateral institutions, IFIs, and civil society to discuss critical matters on delivering impact in the context of a world experiencing a polycrisis. With the theme, \u201cGlobal Action, Global Impact\u201d, the IMF-WBG seeks to continue its work in many arenas of development.<\/p>\n
One of the prominent discussions in the Annual Meetings is the WBG\u2019s Evolution Roadmap. As a response to the widening cracks in the global financial and development architecture, the WBG is in the process of designing a new playbook that aims to\u00a0\u201cenhance the WBG mission, strengthen its operating model, and adapt its financial model towards regaining lost ground and helping countries achieve the Sustainable Development Goals (SDGs).\u201d<\/a>\u00a0Particularly, the playbook takes root on the bank\u2019s\u00a0vision of \u201ccreating a world free of poverty on a livable planet\u201d and the mission to \u201cend extreme poverty and boost shared prosperity on a livable planet\u201d<\/a>.<\/p>\n At the Second WBG Evolution Forum last 10 October, bank officials expressed their support for the new playbook. They emphasized the necessity of private finance in development, claiming that an evolution cannot be achieved without private capital intervention. Officials mentioned the need to create a sound environment to bring in more institutional investors as well as a country-private sector framework that aims to mobilize more finances.<\/p>\n While the WBG boasts of its plans towards transformation, CSOs sound the alarm on the continuing dominance of private sector-led development, lack of climate funding, lack of proper accountability and transparency mechanisms, and the downplaying of the need for a CSO enabling environment.<\/p>\n <\/p>\n The WBG continues to promote and prioritize private finance mobilization in the overall configuration of the Evolution Roadmap. According to them,\u00a0\u201cGreater focus on private capital enabling work is a critical precursor to building a pipeline of bankable projects for future investment to scale up private capital mobilization and meet evolution ambitions.\u201d<\/a><\/p>\n One initiative that manifests their bias towards private sector-led development is their\u00a0Private Sector Investment Lab<\/a>. This intensified effort to bring in more financing and influence from private capital aims to assist in finding actionable solutions to problems faced by developing countries.<\/p>\n However, a grave concern in its establishment is its core group composed of CEOs and chairpersons of multinational corporations whose track records expose cases of rights violations and environmental degradation, among other forms of injustices. Black Rock, for instance,\u00a0shelled out billions of dollars in financing weapons at the height of Russia\u2019s invasion of Ukraine<\/a>\u00a0instead of supposedly using their funds for post-war recovery. How do we expect to achieve genuine development if those entitled to pave the path towards it are the same entities contributing and promoting different forms of oppression against peoples?<\/p>\n The role of the private sector in WBG processes also cascades to the Bank\u2019s country-based engagement model. According to the WBG itself, it will be enhancing national-level interventions\u00a0\u201cwith a renewed focus on enabling and mobilizing private capital flows and domestic resources\u201d<\/a>. This is nothing new \u2013 as seen, for example, in the\u00a0State of Maharashtra Agribusiness and Rural Transformation (SMART) Project in India<\/a>. This project aims to foster economic growth by supporting post-harvest value chain and incorporating small and medium enterprises (SMEs) in market processes. In the IFI perspective, market-based development interventions are said to increase earnings and improve the lives of people. But under the SMART project, and even in other\u00a0private-sector led financing<\/a>, the entry of corporations such as\u00a0Amazon, Walmart, and Pepsico<\/a>\u00a0did not significantly contribute to peoples\u2019 development. Worse, farmers were displaced and earnings remained minimal despite the WBG taking pride in the supposed benefits of the project.<\/p>\n In addition, the WBG is scaling up the role of their private sector arm, the International Finance Corporation (IFC). In the Evolution Roadmap, IFC is expected to expand its pipeline of bankable projects, increase reach to institutional investors, and utilize the Private Sector Investment Lab to mobilize more financing. The confidence of the WBG in the IFC, despite it being\u00a0notorious for financing projects that violate their own social and environmental standards,<\/a>\u00a0is deluded. In the Philippines for example, the\u00a0IFC was found to fund the coal boom in the country<\/a>\u00a0without regard to their own safeguard policies, negatively impacting the lives of many communities and the environment.<\/p>\n In terms of loans, the bank is ramping up the lending capacities of the International Development Association (IDA) and the International Bank for Reconstruction and Development (IBRD). Guised as a contribution in increasing financing for development, such a tactic is only going to be a debt-creating machine that forces countries to adapt austerity policies and dilute public spending to conform with Bank processes. These are clear impacts of the WBG\u2019s interventions especially taking into consideration that their Evolution involves allowing shareholders to provide financing\u00a0\u201conly if linked to their thematic preferences\u201d<\/a>. This blatant and dangerous approach creates space for policy conditionalities that are anchored on unfit-for-purpose market conditions.<\/p>\n With the replenishment of IDA funds next year, it is also worrying that the bank is planning to funnel a significant portion of its concessional financing to IFC which will essentially subsidize private sector-led financing. Under this planned expansion of lending activities, the WBG is basically ignoring accountability for years of gross negligence by their private sector arm and partner corporations.<\/p>\n <\/p>\n Even climate-related interventions of the WBG are co-opted by private capital. Under their planned\u00a0Private to Sovereign Climate Financing Investment Fund<\/a>, the Bank is\u00a0\u201cexploring to directly mobilize private capital from institutional investors to co-finance green public projects, which could also be used to test originate-to-share or co-finance models.\u201d<\/a><\/p>\n It is good to note though that the WBG will be employing the Climate Resilient Debt Clause (CRDC) which will\u00a0\u201cprovide countries [to] temporarily defer principal repayments on their IBRD and IDA loans in case of a severe natural disaster, to reduce debt pressures during a crisis and free up domestic resources for disaster response.\u201d<\/a>\u00a0This mechanism will particularly be adopted in small states which are most vulnerable to climate emergencies.<\/p>\n Despite a seemingly positive outlook on CRDC, the general reality is that loans dominate climate finance policies. Private sector investments to address the climate crisis means more loans and more debt. Instead of holding corporations accountable for their historical role in degrading the environment, the World Bank is allowing them to diminish their culpability to provide reparations. Investment in green and sustainable projects by large corporations are in no way effective if they would not firstly recognize and address decades-long impacts of their interventions in many communities around the world. In fact, Evolution Roadmap documents do not give concrete measures on how to ultimately end fossil finance. This is a telling picture of what matters to them.<\/p>\n The current framework of climate financing led by the Bank and their private sector partners is unabashedly a\u00a0commodification of the climate crisis<\/a>\u00a0where the WBG pushes for more derisking in investments and capital markets take advantage of the moment to reap bigger profits.<\/p>\n <\/p>\n The WBG\u2019s Evolution Roadmap brags about fostering strengthened partnerships with multilateral institutions like the UN and with other multilateral development banks (MDBs) and development finance institutions (DFIs). Meanwhile CSOs and communities continue to struggle in making themselves heard when it comes to raising issues related with shifting away from policy and loan conditionalities that violate rights and degrade the environment.<\/p>\n Although consultations were held to discuss the Roadmap, the First and Second WBG Evolution Forums were mostly attended by international CSOs and invitations to these were only shared to a handful of organizations. Despite the fact that grassroots communities are the ones bearing the brunt of flawed bank policies, they were not given seats on the table. Even with regional dialogues that happened in the last couple of months, recommendations from local and national CSOs were not integrated in the latest Evolution Roadmap documents. The Bank continues on with its old rhetorics that undermine the demands of affected communities.<\/p>\n In fact, the latest version of the Development Committee paper shows how aspects related with effective CSO engagement were only mentioned modestly. Even under an \u2018evolution\u2019, the WBG is still incessant with its mechanism of limiting CSOs and communities to contribute in effective stakeholder engagements. How can the World Bank expect to foster a world free of poverty if those who are most affected by global crises are excluded from important Bank processes?\u00a0Reprisals in development projects<\/a>\u00a0remain and a rights-based approach is in no way reflected in the Bank\u2019s development agenda and playbook.<\/p>\n <\/p>\n All over the world, CSOs, peoples\u2019 organizations, communities, and social movements are calling on the WBG to rethink its new playbook. With the Bank approaching its 80th year, it must be held accountable for its historical role in neglecting peoples\u2019 right to development. Its eight-decade track record is proven unfit to address the demands of the people, especially those from the global South.<\/p>\n The WBG must look within its own premises and recalibrate how they can really tackle the roots of inequalities bearing in mind the need for democratic processes to achieve real transformation. Ultimately, the WBG must commit to putting the public at the core of decision-making processes and to focus on mobilizing concessional financing.<\/p>\n Halfway through the Agenda 2030, and the multiple crises plaguing many countries, the role and objectives of the Bank must be geared towards reforms that are people-centered and rights-based. Otherwise, it would remain to be a bane of peoples\u2019 existence who continue to struggle for genuine transformation of the financial architecture.<\/p>\n \u2014<\/p>\n Signatories as of 13 November:<\/p>\n This post was originally published on FORUM-ASIA<\/a>. <\/p>","protected":false},"excerpt":{"rendered":" The International Monetary Fund and the World Bank Group (IMF-WBG) are gearing to reform themselves as a response to heightening crises of our generation. At the Annual Meetings last 9 to 15 October, the institutions brought together states, multilateral institutions, IFIs, and civil society to discuss critical matters on delivering impact in the context of [ Read more ]<\/a><\/p>\n","protected":false},"author":492,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5,1519,2093],"tags":[],"_links":{"self":[{"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/posts\/1326943"}],"collection":[{"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/users\/492"}],"replies":[{"embeddable":true,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/comments?post=1326943"}],"version-history":[{"count":1,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/posts\/1326943\/revisions"}],"predecessor-version":[{"id":1326999,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/posts\/1326943\/revisions\/1326999"}],"wp:attachment":[{"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/media?parent=1326943"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/categories?post=1326943"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/radiofree.asia\/wp-json\/wp\/v2\/tags?post=1326943"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Continuing corporate capture of development<\/b><\/h4>\n
Putting profit over climate<\/b><\/h4>\n
Lacking initiative to create a CSO-enabling environment<\/b><\/h4>\n
Old takes in a new playbook<\/b><\/h4>\n
Sign the statement:\u00a0https:\/\/bit.ly\/RethinkWBGEvolution<\/a><\/strong><\/em><\/h3>\n
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