This year, donors will negotiate the 19th replenishment of IDA, the triennial fundraising exercise for the World Bank’s poorest clients.
CGD Policy Blogs
In 2015, the world enthusiastically signed on to the challenge of transforming billions to trillions of dollars of private finance for the Sustainable Development Goals (SDGs). The idea was to use public and private development aid to unlock much more commercial private finance for sustainable growth and poverty reduction in developing countries.
The formidable challenge of financing the Sustainable Development Goals has focused attention on the role of private capital in filling huge finance gaps. But for low-income countries (LICs), which receive only about 5 percent of total cross-border private capital flows to developing countries, there is little confidence that external private capital will make a significant contribution.
Why should countries invest in human capital? As emerging technologies impact economies and societies, how can we ensure that the most vulnerable are protected? Who will step up to finance the SDGs? Next week’s Annual Meetings of the World Bank and the IMF will convene 13,000 global policymakers, private sector executives, academics, and civil society members in Bali, Indonesia as they work to address these questions and more.
Amid much discussion of SDG finance gaps, DFIs, both bilateral and multilateral, are in the spotlight as the most important publicly funded instruments for mobilising private capital. Yet, there is a surprising lack of clarity on what we can and should expect from DFIs, beyond broad goals of profitability and development impact.
There is an urgent need to change PSW business models to maintain their financial sustainability while doing much better on mobilization and development impact. Two factors are critical for meeting this challenge: enhanced risk management capability and greater flexibility regarding risk-adjusted returns.
As world leaders gather to kick off the World Economic Forum Annual Meeting in Davos, Switzerland, CGD’s experts weigh in to shed some light on the ongoing debates, with innovative evidence-based solutions to the world’s most urgent challenges, and also discuss what’s not on the agenda but should be.
Trillions in Private Finance for the SDGs? In Davos, Leaders Should Revisit the Role of Multilateral Development Banks
As global decision makers meet in Davos, one of the top agenda items should be how to mobilize more private finance to fund the Sustainable Development Goals—particularly how to strengthen the role of one of the most important tools of the international community: the multilateral development banks.
A consistent but perhaps unsurprising theme of CGD’s September 7 panel discussion, "Women Entrepreneurs: What Really Helps Them Start and Grow Businesses?" was that neither the challenges nor the solutions are simple. Access to finance—frequently emphasized—is not the only issue. And even within access to finance, it is important to look at both supply and demand, at both debt and equity, and at the behavior and attitudes of loan officers as well as bank managers.
The Women's Entrepreneurship Facility (We-Fi) announced at the G20 Summit stands out as a tangible initiative to help address a significant, but often ignored, constraint to growth and job creation—the wide global gender gap in starting and growing businesses. It is telling that, at a time when growth and inequality are core economic concerns, G20 countries have chosen to place an important bet on women entrepreneurs.