Realizing the Potential of National Development Banks to Boost Sustainable Development Financing with MDB Support

Régis Marodon, Thomas Marois, Jacob Woolford and Ali Rıza Güngen

Working Paper from Agence française de développement

Abstract: The world’s public development banks cannot avoid confronting the global environmental and climate finance crises. Nor should they. This research paper asks, ‘What do national development banks (NDBs) need from multilateral development banks (MDBs) to help foster a more catalytic public development bank response to financing the 2030 SDGs at the pace, scale, and on the terms appropriate for global green and just transitions? The paper draws three conclusions: NDB and MDB collaborations are intensely risk and cost sensitive, as well as too slow and complex; NDBs derive real benefit from MDB technical assistance; and NDBs have a sense of being unequal and subordinate partners to the MDBs. Four recommendations arise: (1) the expansion of dramatically more attractive climate financing and grants by the multilateral community; (2) the rethinking of MDB technical assistance; (3) the need for NDBs to build a robust pipeline of domestic projects; and (4) a call for UN Member States to foster a global public development bank ecosystem. The Finance in Common Summit (FiCS) 2025 in Cape Town, South Africa offered advance opportunity to debate and discuss these recommendations in the lead up to the 2025 United Nations Fourth Finance for Development Conference (FfD4) in Sevilla, Spain.

JEL-codes: Q (search for similar items in EconPapers)
Pages: 50
Date: 2025-04-29
New Economics Papers: this item is included in nep-env
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