MDB reform: Taking stock & looking ahead
A key element is to enhance coordination among MDBs. While the diverse structures of MDBs have their own merits, addressing new global challenges will require resources and capabilities of a magnitude beyond the capability of any single MDB.
The current dynamism on the reform agenda stems primarily from the pressure exerted by the shareholders via various forums, including the UN, the G7, and the G20. Among these, the role of the G20 has been particularly crucial. Starting with balance sheet optimisation measures in 2015, the G20 has been slowly and steadily nudging the MDBs to identify necessary actions to strengthen themselves for meeting spiraling development financing needs. The 2022 recommendations from the Independent Review of MDBs' Capital Adequacy Frameworks (CAF) were a significant outcome.
The 2023 G20 Indian Presidency infused more ambition and vision into the agenda, widening its ambit from a balance sheet optimisation effort to a more structural and transformational reform exercise. A G20 Independent Expert Group (IEG) report recommends comprehensive reform of the MDBs to enable them to contribute more effectively to global development financing and the 2023 CAF Roadmap provides guidance accelerating the implementation of CAF recommendations.
Across the MDB ecosystem, there is a concerted effort to move forward on reforms. The World Bank's (WB's) Evolution Agenda has been playing a crucial role in setting the tone. The new vision and mission statement of the WB prioritises global challenges along
