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November 9, 2021

Do we need a climate development bank?

After Harvard’s Kenneth Rogoff, Citi analysts have also called for the creation of a multilateral lender to support the green transition of developing economies, but Leslie Maasdorp, CFO of the New Development Bank – formed by some of those emerging markets – thinks differently

Development banks have been designed to play a counter cyclical role and, because of the Covid pandemic, there has been a rethink on whether we are fit for purpose. In this regard, multilateral institutions are really looking at their mandates, their business models, to see whether there is scope, for example, to take on more risk, to discontinue some activities and refocus on what is needed to design a low-carbon future. However, of the two extremes, one suggesting we create a new global institution and another suggesting that we remodel existing institutions, I think the dominant voices in development finance support the latter.

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