World Bank Voices
Syndicate content

infrastructure

Que papel devem ter os bancos de desenvolvimento?

Ceyla Pazarbasioglu's picture
Also available in: English | العربية | Español | Français



Em todo o mundo, bancos de desenvolvimento estão avaliando sua atuação e observando onde esses esforços têm mais impacto. O tema foi objeto de uma reunião organizada pelo Banco Mundial e pelo Banco Nacional de Desenvolvimento Econômico e Social (BNDES).

Os bancos de desenvolvimento se tornam peças cada vez mais fundamentais à medida que o mundo busca angariar os recursos necessários para atingir os Objetivos de Desenvolvimento Sustentável. Esses bancos podem ajudar a atrair o setor privado e solidificar as parcerias entre os setores público e privado, principalmente em matéria de financiamento de infraestrutura.

No entanto, o uso abusivo de bancos de desenvolvimento pode gerar riscos fiscais e distorções no mercado de crédito. Para evitar essas armadilhas, os bancos de desenvolvimento precisam de uma missão bem definida e devem operar sem influência política, concentrar-se no combate às grandes falhas de mercado, focar as áreas onde o setor privado não atua, monitorar e avaliar intervenções e realizar os ajustes necessários para garantir o impacto almejado. Também precisam ser transparentes e responsáveis.

A new role for development banks?

Ceyla Pazarbasioglu's picture
Also available in: العربية | Español | Português | Français



Earlier this month, development banks from around the world took stock of where they stand and where they see their efforts having the greatest impact at a meeting organized by the World Bank and Brazil’s development bank, BNDES.

As the world struggles to find funds to meet the Sustainable Development Goals, development banks can be instrumental in narrowing that gap. They can help to crowd-in the private sector and anchor private-public sector partnerships, particularly for infrastructure financing.

However, misusing development banks can lead to fiscal risks and credit market distortions. To avoid these potential pitfalls, development banks need a well-defined mandate, operate without political influence, focus on addressing significant market failures, concentrate on areas where the private sector is not present, monitor and evaluate interventions and adjust as necessary to ensure impact, and, finally, be transparent and accountable.

Two themes characterized the discussion at the meeting: how to leverage private capital and create new markets. To support Small and Medium Enterprises (SME) finance, development banks use partial credit guarantees while letting private lenders originate, fund, and collect on credit. In markets with limited competition, development banks support the creation of an ecosystem of specialized Micro, Small, and Medium Enterprises (MSME) lenders to which they provide a stable funding source. 

Developing local capital markets to fund domestic long-term financing needs

Ceyla Pazarbasioglu's picture
Also available in: العربية | Español | 中文 | Français



Finance fuels economic growth and development. Yet, it is also clear that traditional funding sources – public finances, development assistance or banks loans – will not be sufficient to finance the Sustainable Development Goals.

Both developed and developing countries are turning to capital markets to find new sources of funding and to attract private sector financing, investment and expertise.

A key priority for the international development community is to unlock adequate private sector financing so that emerging market countries can meet their financing needs to fund strategic objectives, such as improving infrastructure.

We estimate that the amount of infrastructure financing covered by the private sector could be more than doubled, if countries harness the full potential of local capital markets.

At the World Bank Group, we are committed to marshal our expertise to increase the use of capital markets for investment financing. Helping countries develop government debt markets is vital to our goals of eliminating extreme poverty and boosting shared prosperity.

Connecting pension funds with emerging market infrastructure

Joaquim Levy's picture

It might sound improbable to hear a CFO say this, but I consider one of my roles since joining the World Bank Group to be that of matchmaker. Let me explain.

As I have noted in other blogs over recent months, the world’s emerging market and developing economies—EMDEs for short—face an enormous gap in infrastructure investment. Certainly it is not the only big financing challenge that countries face as they work to reduce poverty and extend prosperity to more of their citizens. But infrastructure underpins many aspects of economic growth, getting people to jobs and schools, connecting goods to markets, reducing the isolation of the poorest areas in many countries.  And by some estimates, the sector’s funding gap is as high as a trillion dollars. 

Field of Dreams: Mapping the Landscape for Investing in Emerging Market Infrastructure

Joaquim Levy's picture
Also available in: Français | Español

Estimates of the financing gap for emerging market infrastructure range from nearly half a trillion USD to more than US$1 trillion a year over the next decade. The range reflects the difference between the estimated level of infrastructure needed to sustain growth across emerging markets and the actual level of such investment.
 
The challenges are immense, and resources are scarce. Of the financing that does exist, more than 70% comes from national government budgets; the second largest source (roughly 20%) is the private sector; and remaining resources come from overseas development assistance or aid from developed economies1. Given the overstretched demands of public sector budgets in developed and developing countries alike, any increase is likely to come through more partnership and co-financing from the private sector. 

Jobs: The fastest road out of poverty

Sri Mulyani Indrawati's picture
Also available in: Español | العربية | Français | 中文

A worker at the E-Power plant in Port-au-Prince, Haiti. © Dominic Chavez/World Bank

For the first time in history, the proportion of people living in extreme poverty has fallen below 10%. The world has never been as ambitious about development as it is today. After adopting the Sustainable Development Goals and signing the Paris climate deal at the end of 2015, the global community is now looking into the best and most effective ways of reaching these milestones. In this five-part series, I will discuss what the World Bank Group is doing and what we are planning to do in key areas that are critical for ending poverty by 2030:
 good governance, gender equality, conflict and fragility, preventing and adapting to climate change, and, finally, creating jobs.

Good jobs are the surest pathway out of poverty. Research shows that rising wages account for 30 to 50% of the drop in poverty over the last decade. But today, more than 200 million people worldwide are unemployed and looking for work — and many of them are young and/or female. A staggering 2 billion adults, mostly women, remain outside the workforce altogether. In addition, too many people are working in low-paying, low-skilled jobs that contribute little to economic growth. Therefore, to end poverty and promote shared prosperity, we will need not just more jobs, but better jobs that employ workers from all walks of society.

Public-private investment to close the infrastructure gap

Joaquim Levy's picture
Also available in: Français | العربية | Español | 日本語

TransMilenio buses near the Simon Bolivar station in Bogotá, Colombia. © Dominic Chavez/World Bank

In a world of slow growth and very low interest rates in most major economies, there is increasing interest in infrastructure development. Building quality infrastructure helps spur economic activity and jobs in the short term and expand countries’ capacity and potential growth in the medium term. It also contributes to higher confidence levels — a key ingredient to macroeconomic stability.

Today, the private sector still provides only a small share of the total investment in infrastructure for emerging markets, despite the importance of private operators in many countries, especially where there are strong fiscal constraints to financing public investment.

Free, French course on PPPs offers customized case studies, relevant regional perspectives

Olivier Fremond's picture
Also available in: Français
Free, French course on PPPs



As a former country manager in Benin, my team and I advised the national administration on the Public-Private Partnerships (PPP) Project Law then under consideration and engaged in PPPs. This effort took place after the private sector, both domestic and international, made a strong commitment to finance large infrastructure programs. Timing is everything, of course, and the window for passing the legislation through parliament before legislative elections was tight – ultimately, too tight. A better understanding of PPPs and the options these partnerships can offer to a country like Benin, which needs substantial infrastructure investments, would have helped the process tremendously.

At the time, however, PPP educational options for French speakers were scarce. Although plenty of PPP resources exist in English, many fewer tools are available for Francophone African countries. These tools are critical to understanding PPPs, creating and adopting legislation, applying PPPs when they may serve a need, and knowing when not to use them to secure infrastructure services.

Spring Meetings webcasts feature Michelle Obama, Bill Gates, John Kerry, economy, climate change, and more

Donna Barne's picture

2016 Spring Meetings Live Events

U.S. First Lady Michelle Obama and Microsoft founder Bill Gates are among the featured speakers at the first major gathering of the world’s finance and development leaders in 2016 – the Spring Meetings of the International Monetary Fund and World Bank Group.

The global economy, climate change, refugees, and the digital divide are just a few of the topics on the agenda in the lead-up to the meetings the week of April 11. We’re webcasting 19 events in multiple languages featuring government ministers, experts, and CEOs.

Tune in Wednesday for a special event with Obama on educating adolescent girls. Later, the World Bank’s top economists will weigh in on economic growth in turbulent times, and Margaret Chan of the World Health Organization co-hosts a session on bringing mental health issues out of the shadows. 

Pages