Frustration and tentative progress at Macron finance summit

World leaders were grateful for the chance to talk climate and poverty in Paris this week — and frustrated that they still had to. Rather than listen to and then seek to address the anger and aspirations of governments outside Europe and the United States — on debt, on climate finance, on donors’ obsession with competing with China — this week’s gathering on a New Global Financial Pact seemed to come late to the idea that the leaders in Africa and Latin America were not totally buying what Western governments had spent the previous day selling. It was only on Friday morning, after a Thursday full of panel debates that served mostly to deliver precooked announcements, that hosting French President Emmanuel Macron and German Chancellor Olaf Scholz — the heaviest G-7 hitters in attendance — yielded the floor to their guests. A “working dinner” Thursday night was closed to the public. Friday’s session, however, was public. And the leaders from the ‘global south’ — a term Kenyan President William Ruto argued should be retired — did not hold back. The president of Ghana Nana Akufo-Addo called, unsuccessfully, for a joint working committee on illicit financial flows out of the continent — long a bugbear of African leaders. He added that more time should be spent on the detail of this week’s proposals, given that past promises have not always been kept. Egyptian President Abdel Fattah el-Sisi recalled the pledge from high-income countries to spend $100 billion annually to help states around the world cope with the effects of climate change, noting this had not been met. Meanwhile, Brazilian President Luiz Inácio Lula da Silva argued that it was impossible to enforce the commitments of the Paris Climate Agreement because global governance was too weak, and South African President Cyril Ramaphosa said some countries such as his own felt like “unequal cousins” in global financial institutions. There were new announcements this week — from a new Just Energy Transition Partnership in Senegal to a Health Impact Investment Platform with three multilateral development banks and the World Health Organization, to a $6.3 billion debt restructuring for Zambia, and the World Bank committing to let countries pause debt repayments in case of climate emergencies. Would these have happened without Macron’s summit? We’ll never know. However, the grievances aired on Friday morning at times appeared to dwarf the solutions on offer. Anger at the inflexibility of the G20 common framework on debt relief is unlikely to be assuaged by a new “user manual” touted by U.S. Treasury Secretary Janet Yellen, for instance. When challenged by Ramaphosa, Macron called on International Monetary Fund chief Kristalina Georgieva to explain that a target of reallocating $100 billion in Special Drawing Rights from high- to low-income nations had in fact been met. Macron clarified that while the full amount has been pledged, only $60 billion of that has so far made its way back to the IMF for use in low-income countries. And Macron seemed perplexed at leaders’ claims to have seen little of the promised $100 billion in climate finance. Experts had told him Thursday that the target had been reached, he said. The final chair’s summary hedged that “the likelihood of reaching the 100bn USD climate finance commitment in 2023 was strongly welcomed, and should be further supported by confirmed figures provided by contributors and reported by the OECD.” In reality, it seems no one really knows. But time was ticking on, and so Macron was soon reading a list of deliverables. Each issue — from maritime levies to Paris-aligned Carbon Markets — seemed to warrant a summit to itself. Such gatherings serve a purpose, some say, because they force governments and institutions not to come empty-handed. But the risk, exemplified for instance by the European Commission using the event to launch its already-announced inequality marker, is that participants just bring whichever piece of the status quo they have coming to the boil at the time. Ultimately, this week’s event put the Bridgetown Agenda of Barbados Prime Minister Mia Mottley on the front page of Le Monde. Macron spoke about the need to marry the fight against climate change and poverty for 30 minutes on drive-time radio. With development budgets under strain, particularly in light of the war in Ukraine, that is not nothing. Meanwhile, behind-the-scenes negotiations over how to reform the world’s multilateral development banks helped clarify countries’ positions ahead of the critical Annual Meetings of the World Bank and IMF in October. Is the world a better place because Emmanuel Macron invited world leaders to the Palais Brongniart this week? It’s too soon to tell. It always is.