Finance in Common Building resilience for people and planet
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Finance
in Common
The first global summit of all Public Development Banks
PARIS
10-12
November
2020
Building
resilience
for people
and planetWe have a responsibility to recover
better. We must keep our promises
for people and planet.
Organizers UN Secretary General
of the Finance António Guterres
in Common Summit
Under the patronage of UN Secretary-
PDBs deliver a unique service,
General António Guterres and President
Emmanuel Macron (tbc), the Finance in that of linking governments
Common Summit is: and the private sector
an initiative of the World Federation of and turning domestic and
Development Finance Institutions (WFDFI) international policy signals
and the International Development Finance
Club (IDFC), into local solutions.
taking place during the 3rd Paris Peace Forum,
WFDFI Chairperson
convened by the Agence française de déve- Thabo Prince Thaman
loppement (AFD), with the support of:
Multilateral Development Banks,
IDFC members have
regional associations of Public
collectively mobilized their
Development Banks (ALIDE, AADFI,
ADFIAP, ADFIMI, ELTI, EAPB, EDFI), financial capacity and
relevant international institutions
expertise to provide an
(UNDP, UNEP, OECD and the immediate response to the
European Commission), short-term health challenges
and the Caisse des dépôts as well as to prepare for a post-
et consignations.
Covid-19 world that will require a
long-awaited paradigm shift.
IDFC Chairperson
Rémy RiouxThe Finance in Common Summit
BUILDING RESILIENCE
FOR PEOPLE AND PLANET
The first global summit of all Public Development
Banks, taking place during the Paris Peace Forum in
November 2020, will address our common need to build
new forms of prosperity that take care of the living (people
and planet) in a resilient manner.
In the context of the Covid-19 pandemic and and the G20 Summit.
subsequent global socio-economic crisis, To ensure broad and
the Finance in Common Summit will stress effective engagement
the crucial role of Public Development Banks with all stakeholders, and in
(PDBs) in reconciling short-term counter- light of the Covid-19 crisis and
cyclical responses to the crisis with sustainable its consequences, the Summit
recovery measures that will have a long-term will deploy an innovative mix of
impact on the planet and societies. Gathering in-person and enhanced digital
PDBs from around the world, the Finance in session formats.
Common Summit is an opportunity to:
Leading up to the Summit, a
build a new coalition of actors and launch research conference will be
a collective dynamic aimed at fostering the held on 10 November,
emergence of a global response to global during which a consor-
challenges; and tium of prominent
academic institu-
d emonstrate the potential of PDBs in tions will pres-
linking short-term needs with long-term ent papers and The reorientation of
transformations, and in redirecting financial share insights global finance towards
flows towards sustainable development about how climate and SDGs needs
objectives. PDBs can pro-
a deeper and more
duce better
coordinated effort. Public
FOSTERING COLLECTIVE ACTION finance over
the long term.
Development Banks are
The Finance in Common Summit is taking Summit partic- a significant part of the
place 12 November 2020 during the Paris ipants are most solution.
Peace Forum, an annual event focused on welcome to join.
improving global governance. The Summit is
intended to contribute to the COP26 agenda
FINANCE IN COMMON - 1Public Development Banks
A key to delivering the finance
we need for the future we want
Public Development Banks have a key role
to play in reorienting existing investment
patterns towards – and facilitating increased
investment in – sustainable development.
With their public
mandates and counter-
cyclical role, Public
Development Banks There are about 450 engaged in commercial banking,
are more relevant than Public Development individual bank accounts or consumer
ever to contribute to Banks (PDBs, also credit.
called Development
the reconciliation of
Finance Institutions) The volume of activity of these institu-
economic recovery
around the world, oper tions amounts to about USD 2 trillion
and sustainable ating at sub-national, annually – a staggering 10 percent of
development. national, regional, inter- the total amount invested in the world
national and multilateral every year by all public and private
levels. PDBs share three main sources combined. With their public
attributes: mandates and counter-cyclical roles,
PDBs are more relevant than ever to
T
hey enjoy independent legal status help reconcile necessary short-term
and financial autonomy. responses to Covid-19-related crises
with solutions for long-term sustain
They are controlled or supported by able development. These institutions
central or local governments. represent a “visible hand” that can
help mobilize and direct the finance
They execute a public mandate, we need for the future we want.
addressing market inconsistencies
– notably for the financing of small A COURSE OF ACTION TO
and medium enterprises, essential RESPOND TO NEW CHALLENGES
infrastructures, local financial mar-
kets, housing, small agriculture, What type of collective action is
and regional and international required to avoid a long recession
trade – to the benefit of entre- and make the post-Covid-19 recovery
preneurs, rural households, a sustainable one? How can PDBs
and the most vulnerable, help economies cope with short-term
including women and employment support and long-term
young people. necessary transformation of indus-
tries? How can they implement the
But they transition towards a low-carbon and
are not resilient economy? These questions
2 - FINANCE IN COMMONwill be at the core of the Finance in after, or in conjunction with PDBs’ volume
Common Summit. financial markets. of activity
PDBs are already supporting the cli- A NEW VISION OF DEVELOPMENT
mate and SDG agendas. They provide Financing
long-term or concessional resources,
initiate knowledge-sharing and techni- Some PDBs have already been active
cal-assistance programs, and promote for decades, and an increasing number
private-sector involvement. In their
effort to align with the goals of the Paris
of governments are either strength
ening them or establishing new ones. ≈ $2,300 billion
invested annually
Agreement and the SDGs, a growing Their legitimacy is reinforced by a new
number of PDBs are also setting new vision of development financing – one
requirements for the allocation of their that extends beyond the scope of
own funding. However, the reorienta- infrastructure investment or other tradi
tion of global finance towards climate tional mandates and that is capable of
and SDGs requires a deeper and more mobilizing both government institutions
coordinated effort to profoundly trans- and financial markets.
form harmful practices. 10%
On the ground, PDBs can help deliver of the total amount
concrete and sustainable the institutional change and real
invested in the world
every year
solutions economy outcomes that are required
to turn the UN SDGs into reality.
In a world awash with liquidities, there For example, their funding and
is an urgent need for a coalition of advice to governments can boost
financial institutions able to transform investment in social infra-
public resources into concrete and structure, notably for
sustainable projects on the ground. healthcare. They can
Such coordination among PDBs would also help build
eventually link international policy the confidence
issues with local solutions, and gov- to achieve
ernments’ ability to identify sustain carbon
able development trajectories with neutrality
private-sector opportunities. by 2050, On the ground, Public
while Development Banks
As public institutions, they represent a increas- can help deliver the
modern and large coalition of actors. ing the institutional change and
PDBs are organized by region, with use of
real economy outcomes
deep roots in local economic and social nature-
fabrics, and with historic support from based
that are required to turn
regional Multilateral Development solutions. the UN SDGs into reality.
Banks. They play a vital part among
local stakeholders and can deploy a
wide range of powerful instruments
in order to bridge market failures,
mobilize domestic resources, redirect
investments, support private sector
mobilization and promote sustainability.
PDBs are able to deliver both the “first
mile” and the “last mile” of funding,
connecting policy intentions with
results on the ground – before,
FINANCE IN COMMON - 3OVERVIEW
Public Development
Banks AT A GLANCE
There are about 450 Public Development Banks
(PDBs) in the world. Where are they, in which
sectors, how much do they disburse?
Where in the world
What’s
What’s are PDBs? Global distribution
aaPDB?
PDB?
Public Development Banks
(PDBs) are a vast family of 5 NEW PDBs North America
institutions at the intersection CREATED IN 2019
between finance and public policy.
They share three characteristics: 4% International
Development
They enjoy independent legal status Finance
and financial autonomy. Corporation
Banco del (DFC-US)
They are controlled or supported by Bienestar
central or local governments. (Mexico)
Central and
They execute a public mandate, addressing South America
market inconsistencies – notably for the
financing of small and medium enterprises,
essential infrastructures, local financial
19%
markets, housing, small agriculture,
and regional and international trade
– to the benefit of entrepreneurs,
rural households, and the most
vulnerable, including women and
young people.
PDBs operate everywhere
at the international, regional, national or local level
But they are not engaged
in commercial banking, GEOGRAPHIC mandate Ownership
individual bank (% of institutions) (% of assets by nature of owner)
accounts or
consumer Local 12% 16% Global Multilateral 10% 13% Local Gov.
credit.
7% Regional
National 65%
National Gov. 77%
4 - FINANCE IN COMMONHOUS
Public social housing
6 types 4%
10% 9%
LOCAL
of mandate 1% 9% Decentralization and local governments
MSME About
45 Micro-, small- and medium-scale
Number of PDBs
by mandate
159 43 enterprises 450 PDBs
AGRI in the world
15
28 150 Agricultural development in 2019.
EXIM 30% of them
% of the assets 67% Foreign trade
were created
by mandate
GENDEV after 2000
Infrastructures and all sectors
Europe
Hellenic Development
Bank (Greece)
Romanian Development
Bank (Romania)
Asia $11.2 TRILLION
in assets in 2018
23%
8% Mediterranean
region
3% 16%
Central Asia 4% $2,300 BILLION
22% Sub-Saharan Africa Pacific
average annual
disbursements,
representing around
Banque
Agricole
10% of world
du Faso
World gross capital
formation
(Burkina
Faso) 1%
Amazing facts
The World Bank, created at Bretton Woods in 1944, is a global reference for
governance, strategy, efficiency and international cooperation
China Development Bank is the largest PDB with 2.4 trillion in assets (2018)
Caisse des Dépôts et Consignations (France), created in 1816, is the oldest PDB
21 PDBs make Brazil the country with the most numerous institutions 90% of
European Investment Bank, the regional bank for Europe, is a reference for the
development of European economies and infrastructures
TOTAL assets
($10.2 trillion) are
Scottish National Development Bank, to start operations in 2020, is the newest PDB owned by the
50 largest PDBs
FINANCE IN COMMON - 5The Paris Peace Forum
GLOBAL CHALLENGES,
PRAcTICAL SOLUTIONS
For the third year, the Paris Peace Forum is
convening all actors of global governance,
from heads of state to civil society, to push
forward projects and initiatives meant
By taking part in the to improve collective action. Public
Paris Peace Forum, Development Banks are invited to apply
Public Development to the Call for Projects to present and
Banks will have advance their initiatives.
an opportunity
to showcase
innovative projects. The challenges the bringing together old and new actors
world faces – climate of global governance: states and public
change, pandemics, entities, multilateral organizations,
terrorism, cyber insecurity NGOs and private-sector, foundations,
and inequalities, especially civil society at large, and this year,
based on gender – ignore Public Development Banks (PDBs).
borders. But whereas addressing
them would require international Most of all, the Forum is project-
cooperation and collective action, oriented: every year, its Space for
collaboration seems to be increas- Solutions showcases concrete gov-
ingly difficult as countries are turn ernance solutions that take on global
ing inward. Today, the international challenges. These initiatives can
community struggles in finding the be normative – instruments of
appropriate responses. law, standards and good prac-
tices – or oriented towards
Global problems call capacity-building – new
for global solutions institutions, mechanisms
and innovations.
The mission of the Paris Peace Forum
is to contribute to bridging this PDBs are also
global governance gap. It is based invited to submit
on a simple observation: global their projects
problems without cooperative focused on the
solutions can lead to conflicts. operational
response to
To advance concrete prac- the Covid-
tical solutions where 19 crisis.
there are none, the
Forum fosters
hybrid coali-
tions by
6 - FINANCE IN COMMONPDBs, come and promote
your initiatives
By taking part in the Paris Peace Forum, you will have the
unique opportunity to showcase your innovative solution
and push your project forward. A chance for you to not only
increase the visibility of your project, but also test it before
diverse audiences, all the while connecting with potential
partners and sharing your experience and knowledge with
other project leaders and participants from all over the
world. Last but not least, 10 projects from the Space for
Solutions will be selected to receive additional resources
with an ongoing support during the whole first year of their
implementation.
Projects leaders who will not be able to travel to Paris
because of health restrictions will be able to
showcase their project online.
Call for projects
submit your project before 12 May 2020
Do you have a project offering a concrete solution to tackle a global challenge? Apply
with one or several projects through the online platform, before 12 May 2020. Special
consideration will be given to initiatives addressing the following objectives:
BOUNCING BACK AFTER CONSTRUCTING MORE RECONCILING DEVELOPMENT CRAFTING
CORONAVIRUS AND IMPROVING SOLID SECURITY FINANCE WITH CLIMATE SUSTAINABLE
TOOLS OF RESILIENCE ARCHITECTURES EFFORTS CAPITALISM
PROTECTING IMPROVING ACCESS MAKING OUTER SPACE SECURING
THE OCEANS TO CLEAN WATER SAFE AND SUSTAINABLE CYBERSPACE
TO SUBMIT YOUR
REGULATING THE ENHANCING THE ENSURING GENDER PROJECT(S),
CONNECT TO:
USE OF DATA AND AI GOVERNANCE OF EDUCATION EQUALITY
The Call for Projects is open to all key actors of global governance: States,
parispeaceforum.org
international organizations, NGOs, companies, foundations, philanthropic
organizations, development agencies, religious groups, trade unions, think
tanks, universities, and more.International Research program
The Visible Hand
development banks in action
for climate and SDGs
On 10 November 2020, a research conference will take place
in Paris, gathering a community of researchers as well
as Public Development Banks representatives. In the
context of the Covid-19 crisis, this conference will be
an opportunity to exchange insights and findings,
clearing the way ahead.
The research An international group of Development Banks and regulators.
conference aims to prominent researchers has The paramount question concerns the
deliver concrete, been constituted to support scaling up of the Development Banks’
evidence-based the Finance in Common contribution to the action plan for climate
Summit with a series of aca- and SDGs. The severe crisis affecting
recommendations for
demic papers. They will liaise the world, which follows the Covid-19
the consideration of
closely with senior officials disruption, is indeed opening an avenue
decision-makers. from Public Development Banks for better, larger, and more responsible
(PDBs), including members of banking in order to rebuild our economic
the International Development systems in a more sustainable way.
Finance Club (IDFC) and the World
Federation of Development Finance 5 key challenges
Institutions (WFDFI), as well as with other
stakeholders, notably from the private The research group aims to deliver key
sector. The event will be broadcasted contributions on:
and its material published in a confer-
ence proceedings booklet. 1. The inclusion of Development Banks
in the architecture of global finance and
OPENING A PATH FOR MORE the efficient use of the various types of
RESPONSIBLE BANKING Development Banks (multilateral, inter-
national, regional, national, and local).
The research group will present its
work and findings during a confer- 2. The business model of Development
ence on 10 November. This confer- Banks. The research group will aim to
ence will aim to deliver concrete, evaluate which of the Development
evidence-based recommenda- Banks’ instruments are best suited to
tions for the consideration of maximize their impact on sustainable
decision-makers who will development. An important task being
be participating at the also to catalyze funds from the private
Finance in Common sector and to take into account the dif-
S ummi t . That ferent levels of development or priorities
includes gov- of the countries.
ernments,
8 - FINANCE IN COMMON3. Alignment with long-term climate reflecting their vision of the
Research group
coordinators
and SDG trajectories. A primary role PDBs could play for an
challenge for coherent action is to efficient financial architec-
find common frameworks to guide all ture. These institutions may
Jiajun Xu, Executive Deputy Dean
investments – public and private, in include the IDFC, the Overseas
at the Institute of New Structural
higher- as well as lower-income econo- Development Institute (ODI) Economics (INSE) at Peking University,
mies – from all actors in the direction of of London, the OECD/UNDP, China; leading, along with the AFD
the SDGs and the Paris Agreement. On the Institute for Climate research department, the construction
SDG alignment and among many other Economics (I4CE) in Paris, of the first comprehensive database
on DFIs worldwide
ongoing initiatives, the G7-mandated the World Resources Institute
initiative led by the UNDP and the OECD (WRI), and the Green Climate Stephany Griffith-Jones, Financial
will present its first results at the end Fund. Other research centers, Markets Program Director at the
of 2020. The use of robust taxonomies, think tanks and practitioners are Initiative for Policy Dialogue at
Columbia University, United
including the framework for sustainable invited to participate and share their
States; co-author of
investment developed by the European findings on the role that DFIs may The Future of National
Union, can also be a useful basis to play in achieving the SDGs. Smaller Development Banks
support investment in certain assets or institutions prominent in their home
Régis Marodon,
to support climate-related risk analysis. country will be specifically included.
Sustainable Finance
Multilateral Development Banks and Advisor at the
the IDFC, committed to aligning with The AFD, the IDFC and the Ford Economic Research
the Paris Agreement, are also making Foundation have confirmed Department
progress in defining the appropriate their support for the of the AFD,
France
methodology. Research Program.
4. Regulatory frameworks and public
incentives. These frameworks will be research program
Main participants
examined in their capacity to provide
a relevant set of incentives in order to
engage in climate and SDGs.
The inclusion of Development Banks
5. Mandate and governance. Aside Jose Antonio Ocampo, former Colombian Finance Minister;
from international and multilateral professor, Columbia University, United States
Alfredo Schclarek Curutchet, associate researcher, National Scientific
development banks, very few PDBs
and Technical Research Council (CONICET), Argentina
currently benefit from mandates
explicitly related to the climate
The business model of Development Banks
and SDG agendas. Best prac- Stephany Griffith-Jones, research group coordinator (see above)
tices on how to effectively Jiajun Xu, research group coordinator (see above)
govern Development Banks Shari Spiegel, Chief of the Policy Analysis & Development Branch in the
(financial autonomy, trans- Financing for Sustainable Development Office of the UN-DESA
Eduardo Fernandez-Arias, former Principal Research Economist, Inter-American
parency, accountability,
Development Bank
etc.) will be discussed. Patrick Guillaumont, president, and Laurent Wagner, research fellow, Foundation
for studies and Research on International Development (FERDI)
Reaching out
for a stronger Alignment with long-term climate and SDG trajectories
coordinated Kevin Gallagher, Director, Global Development Policy Center of Boston University,
effort United States; co-chair, T-20 Task Force on International Financial Architecture
Sébastien Treyer, Director, and Damien Barchiche, head of Agenda 2030 program,
Institute of Sustainable Development (IDDRI)
Along with the re Harvey Himberg, Environmental and Social Safeguard Consultant, Green Climate Fund
search group, addi- Ian Cochran, Director of Financial Institutions Program, I4CE
tional institutions
may contribute to Regulatory frameworks and incentives
the conference with Ulrich Hege, Vice-President, Toulouse School of Economics, France
their own studies Ricardo Gottschalk, Economic Affairs Officer, UNCTAD
Lavinia Barros de Castro, researcher and manager, BNDES
Mandate and governance
Tianyang Xi, political scientist, National School of Development, Peking University, China
Samantha Attridge, Senior Research Fellow, ODIExpected deliverables
MOBILIZING A NEW
GLOBAL COALITION
By challenging a new and significant global community with enhanced
capacity of action, and by promoting sustained collective action, the
Finance in Common Summit seeks to contribute significantly to the success
of the UNSG’s “Decade of Action”.
Expected outcomes for Public Develop Making the most
ment Banks (PDBs) during the Summit of our momentum
and beyond:
Within the Paris Peace Forum, whose
Presentation of an overview of purpose is to advance practical gov-
the action of PDBs, describing the ernance solutions and scale-up proj-
complementary role of domestic ects, the Finance in Common Summit
and international finance as well as is an opportunity to launch concrete
public and private finance in meeting measures and innovative initiatives.
the Paris Agreement’s goals and the The Forum will showcase a specific
SDG agenda. A Public Development Call for Projects that focuses on the
Banks research paper (or series of operational response to the Covid-19
papers) – explaining the role crisis, and PDBs are invited to submit
and business model of PDBs, projects. Donors might also very well
their governance and stake take the Summit as an opportunity to
holders, their operations announce initiatives that support and
and their impacts – will incentivize the alignment of PDBs
Moving forward, the
be released during the with SDGs.
Finance in Common Summit, along with
Summit could also other contributions Moving forward, the Finance in Common
welcome individual from various partners Summit could also welcome individual
statements from a on their vision of the statements from a number of Heads of
number of Heads of role PDBs could play State and government leaders, as well
State and government for an efficient financial as from all willing stakeholders, notably
leaders. architecture. the private sector and civil society, out-
lining concrete commitments to adjust
A collective state their mandates and support the work of
ment from all Public their PDBs towards climate and SDGs.
Development Banks declar-
ing their willingness to actively By rallying and challenging a new
contribute to the recovery while and significant global community with
aligning with sustainable finance enhanced capacity of action, and by
principles and incorporate the goals of promoting sustained collective action,
the Paris Agreement, the Convention the Finance in Common Summit seeks
on Biological Diversity, and the 2030 to contribute substantially to the suc-
Agenda into their business strategy, cess of the UNSG’s “Decade of Action”.
core standards and impact analysis. In
addition, the statement would account
for progress made.
10 - FINANCE IN COMMONFinance
in Common
The first global summit of Public Development Banks
financeincommon.org
Follow THE SUMMIT
@FinanceInCommon
#FinanceInCommon2020
contact@financeincommon.org
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