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“Finance in Common Summit”: Experts call for greater international cooperation to address the situations of fragile countries worsened by the health crisis

November 13, 2020

International experts on Thursday called for a concerted response and broader cooperation between public development banks and actors in the field to provide concrete responses to fragile countries whose situations have been worsened by the global Covid-19 crisis.

They spoke during a virtual session on “Human Security in Fragile Contexts: Scaling up Humanitarian and Resilience Investments,” on the second day of the Finance In Common Summit, currently underway.  The high-level panel included Khaled Sherif, the Bank’s Vice President for Regional Development, Integration, and Service Delivery, Katherine Garrett-Cox, head of GIB Asset Management, Peter Maurer, President of the International Committee of the Red Cross (ICRC), and Shinichi Kitaoka, President of the Japan International Cooperation Agency (JICA).

Maurer, noted that COVID-19 had seriously worsened the situation in fragile countries,already affected by food insecurity, climate change, and armed conflict. Nearly 80 percent of the world’s fragile situations originate from situations in Africa and the Near East, he said.

“Whether it is a question of access to healthcare, access to water, living conditions or employment, we need to analyse each specific context. We must build programmes that respond to each need,” he stressed. The urgency of some situations required greater cooperation between actors in the field and public development banks, he said. These banks alone inject $2.3 trillion dollars each year into the global economy, or ten percent of the total amount invested.

JICA President Shinichi Kitaoka, highlighted his country’s current support to African countries affected by the global health crisis, particularly in health infrastructure and the provision of medicines. “Japan has financed the construction of about 100 hospitals across the continent,” he said. Kitaoka added that Japan is committed to achieving carbon neutrality by 2050 and that it will support African countries in their work toward sustainable development and green and inclusive growth.

Katherine Garrett-Cox Chief Executive Officer of UK-based GIB Asset Management, highlighted the 34 percent growth in the sustainable investment market between 2016 and 2018, to $30 trillion, responding to the growing demand for sustainable finance investments over the past decade.

“Firstly, there is a growing consensus that good sustainable development practices can generate good return on investment,” she said. “Secondly, there is a growing awareness of the importance of mobilising capital for sustainable development.” She stressed the fact that the COVID-19 pandemic had underlined the need for social sustainability.

In the context of a health crisis which could destroy 30 million jobs and increase the number of people living in extreme poverty to 450 million, Sherif was optimistic about the willingness of development actors to work together to strengthen and stabilise the situation in at-risk regions and fragile countries. “For too long, we have left the issue of the development of vulnerable populations to humanitarian organizations, NGOs, foundations, and civil society actors,” he said. “Now we need to create new and strong alliances to increase the impact of humanitarian and development actions for rural communities and vulnerable populations.”  

In conclusion, Khaled Sherif reiterated the African Development Bank’s strategy: “We are convinced that only an integrated Africa is a resilient Africa, creating prosperity across the continent.”

Through its “High 5” operational priorities, the Bank has strengthened its support to fragile states, with commitments increasing by 51 percent between 2014 and 2019 (as compared to 2008-2013). Some 345 activities with a value of S$6.45 billion have been approved for these countries, where the main development challenge remains fragility.

“Finance in Common” is an event held virtually as part of the third Paris Peace Forum, taking place from 11-13 November 2020. Bringing together 450 public development banks, this first world summit aims to build a new coalition of development-centred financial institutions. Such a coalition is vital to confront the new global challenges posed by the COVID-19 crisis and to redirect financing towards inclusive growth, taking into account the commitments of the Paris Agreement and the Sustainable Development Goals.

*AFDB

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