Date: 9th – 15th October 2023
The 2023 Annual Meetings of the World Bank Group and the International Monetary Fund (IMF) will take place in person in Marrakech, Morocco. The theme for the Annual Meetings will be “Global Action, Global Impact.” FSDA team will use the occasion to seek input and guidance on matters raised by the Inception Report. The Annual Meetings provide a unique opportunity to seek feedback from the MDBs, capital market and pension regulators as well as from private sector stakeholders, such as institutional investors and assets managers.
While there is clear consensus among key stakeholders on the need to act, both action and clarity on how to achieve that have been more elusive. Two independent expert groups have reported to the G20 in the last year, including in July 2022 with a clear action plan on five recommendations to reform capital adequacy frameworks (CAF) to unlock hundreds of billions in new development finance. Such reforms would form a strong basis for additional capitalisation of the banks. One year on from the report’s publication, the G20 roadmap provides a first assessment of implementation so far, based on input from the MDBs themselves and from shareholders. A public event in the margins of the Annual meetings would provide an opportunity for discussion with a broader audience and introduce an element of external validation (as called for by the Roadmap itself.
Moreover, this event will complement other planned discussions by focusing on political action to deliver on the technical solutions. It should tackle the political challenges to reform, whilst remaining rooted in technically sound solutions. Focus areas that need the biggest push could include: callable capital, Global Emerging Markets Risk Database, hybrid capital and benchmarking.
A 75 minutes panel discussion with representatives of MDBs, shareholders and civil society will be followed by a networking reception showcasing relevant projects funded by the MDB Challenge Fund.
The event is organised by the MDB Challenge Fund and FSD Africa, with the support of the Bill & Melinda Gates Foundation, Open Society Foundations and Rockefeller Foundation.
FSD Africa responded to the request for proposals of the Multilateral Development Banks Challenge Fund, with the aim of funding innovative solutions that empower multilateral development banks (MDBs) to provide more financing to developing and emerging economies. In June 2023, FSD Africa was awarded funding to develop a project focused on a “Local Currency Solution for Multilateral Development Bank Portfolio Transfer.” Our work on program design and initial marketing sounding is progressing well, and we intend to complete the project’s Inception Report by the end of September. As per our project proposal, we see the Annual Meetings as a unique opportunity to seek input and guidance on matters raised by the Inception Report.
The primary aim of this closed-door roundtable is to enhance awareness of the design of the portfolio transfer project among a core group of stakeholders. This includes those responsible for MDB risk and capital management, particularly representatives of the MDBs’ Treasury Departments. Additionally, we aim to sensitise a broader audience within the MDBs about the potential benefits, including freed-up capital for specific sectors (with a focus on infrastructure and financial sectors) associated with the portfolio risk transfer.
FSD Africa and Systemiq’s Blended Finance Taskforce are pleased to convene a private roundtable on the sidelines of the World Bank Annual Meetings in Marrakech. Mobilising domestic institutional capital for low-carbon power systems, resilient infrastructure, green industry, regenerative agriculture and nature-based solutions across the African continent is one of the most important levers to drive climate-positive growth and inclusive development. But existing risk/return dynamics, policy choices and transaction costs to access catalytic capital create barriers to investment. Addressing the rules, regulations and risk-sharing mechanisms that can help mobilise African domestic capital – both debt and equity – will be a critical part of discussions during the world bank meetings.
The session aims to bring together leading practitioners across the African financial system to discuss systemic solutions to these challenges.