Finance in Common Summit: CSOs frustrated by another event driven by a global north agenda that does not respond to the polycrisis
This week’s Finance in Common (FiC) summit of more than 500 public development banks is the latest global north-dominated forum where yet again private capital ‘mobilisation’ is the big priority.
This is the view of several civil society networks from across the world, who have repeatedly expressed concerns about FiC, currently staging its fourth summit in Cartagena, Colombia. They argue that the event is little more than a “talking shop’, where the debate is yet again dominated by a heavy reliance on attracting private finance at scale, with risks guaranteed by the state and public money. They also call for the transformation of the unjust international financial architecture - a sentiment echoed at this week's Africa Climate Summit in Nairobi where Kenyan President William Ruto called current action by multilateral development banks 'insufficient'.
The final FiC Communiqué, published today, seeks instead to reinforce the status quo, offering so-called innovative solutions that will only intensify the financialisation of development and climate. A 'blue finance roadmap' and Global Green Bond Initiative are just some of the measures that will serve to aggravate the lack of democratic oversight of funds, increase the debt problems in the global south, and deepen the prioritisation of private interests over public wellbeing.
Discussions on how to tackle the current debt and climate crises - and the urgent need for more and better public development finance - should instead take place in a truly representative forum - the United Nations. The UN has called for a concerted effort to address the polycrisis, and has already adopted an historic resolution on global tax architecture reform.
Here you will find quotes from regional and global civil society networks that work on finance for development and climate action:
Patricia Miranda, Global Advocacy Director of the Latin American Network for Economic and Social Justice (LATINDADD) said: “Multilateral Development Banks, including regional development banks from Latin America, which are important creditors in several countries, need to urgently contribute to the Climate and 2030 Agendas. The FiC Communiqué makes clear that the Banks are relying heavily on mobilising private finance, including by offering so-called innovative solutions. These are piecemeal solutions that will only aggravate debt problems. We need greater access to concessional and additional financing for low and middle-income countries. So far, we have not seen action from these banks to tackle the multiple crises as they still fund fossil fuels and highly polluting industries, and they continue with the business-as-usual approach that does not provide a middle and long-term sustainability".
Jason Rosario Braganza, Executive Director at The African Forum and Network on Debt and Development (AFRODAD) said: “The FIC Summit continues to demonstrate deliberate attempts to deepen financialisation and private solutions to the poly-crisis affecting countries in the global south. Market-based solutions are the root cause of the poly-crisis and therefore what is needed is a systemic agenda that will address the climate emergency while delivering transformation for countries in Africa. The solutions for Africa do not lie with more debt nor private finance but with efforts to generate its own domestic resources. This is something that African CSOs including AFRODAD have been voicing strongly at the Africa Climate Summit in Nairobi, Kenya.”
Lidy Nacpil, Coordinator of the Asian Peoples’ Movement on Debt and Development (APMDD) called on public development banks and the governments that control them, to “undertake bold, rapid and concrete steps in the direction of a just, people-centered response to the multiple crises.” She added: “In the lead-up to COP28, you are reminded of your commitments to common action for climate, biodiversity conservation and the realization of the UN Sustainable Development Goals. We urgently call for non-debt creating finance for economic and climate justice actions, an end to the public financing of fossil fuels and agro-industrial systems, and the cancellation of unsustainable and illegitimate debts of Global South countries."
Flora Sonkin, Policy Research Officer at Society for International Development said: “The FiC continues to be a distraction from the more democratic global governance spaces where policy decisions on how to tackle the deep and systemic crises we are facing should be happening, such as the Financing for Development process at the UN. The FiC gathering promotes an agenda focused on mobilizing private finance, under the problematic assumption that the role of PDBs and governments should be to ‘de-risk’ private investments in the global south and ‘create markets’ for private investors. Instead, the international community should focus on freeing up public resources through solutions such as debt cancellation and global tax architecture reform, while PDBs should respond to the public interest by divesting from infrastructure projects that lock countries into unsustainable futures.”
Alexandra Gerasimcikova, Policy and Advocacy Officer at Counter Balance said: ‘Public development banks such as the European Investment Bank use the summit as an opportunity to boast about the sustainability of their finance while pouring billions into the most polluting fossil fuel giants. On top, little has been done over the years to do better in terms of human rights due diligence, higher development impacts, or transparency. While development banks become increasingly profit-chasing institutions, what we urgently need is quality public finance for projects that address people’s needs – not corporate profits – and support public services accessible to all.’
Jean Saldanha, Director of the European Network on Debt and Development (Eurodad), said: "FiC summit organisers say that this event is to "align the finance to the SDGs and the Paris Agreement". But the reality is that public development banks are relying heavily on attracting private finance. This is nothing new, and is in fact blind to existing evidence that private finance has not made any discernible impacts in countries or sectors that do not guarantee adequate profits.
"Instead, we need more public finance to be freed up to tackle the polycrisis the world is facing. We need genuine action on the debt crises; we need climate commitments to be met with new and additional resources; and we need the United Nations to be allowed to fully take the lead on this."
Communications Manager, Eurodad
jravenscroft [at] eurodad.org/ +44 7958 184 695.