Multilateral development banks, or MDBs, need to work closely with governments to improve the attractiveness of countries for sustainable private sector funding, according to Jin Liqun, president of the Asian Infrastructure Investment Bank.
In an interview with Devex at the Fourth International Conference on Financing for Development in Sevilla, Spain, Jin highlighted that the future of global finance is about looking at the “big picture” rather than just focusing on the amount of money provided.
“MDBs should not only be thinking about how much money we can mobilize,” said Jin. “They should work with governments to help them understand the importance of creating a very good macroeconomic and regulatory environment.”
He said this is particularly important amid current constraints on funding, calling for development projects to be carried out more cost-effectively.
Jin also emphasized the importance of MDBs continuing to work together to help achieve these goals, creating more influence, greater confidence from private investors, and a stronger financial infrastructure in light of limited individual resources. “By working together, we can pool resources for major infrastructure projects,” he said. “We find that the benefit is far more important than increasing some of the funding for a particular project.”
During the interview, Jin reflected on the past decade at AIIB, which will soon officially celebrate its 10th anniversary after launching in January 2016 — about six months after the Third International Conference on Financing for Development, in Addis Ababa, Ethiopia.
Noting that the launch also happened at the time when the Paris Agreement was about to enter into force, Jin cited AIIB investments to date of over $60 billion in more than 320 projects across 38 economies.
The focus so far, he said, has been on building a bank with a sound governance structure. Over the next 10 years, Jin hopes further progress will now be made in improving countries’ investment environments, but cautioned that this will take time — especially as some development challenges have grown more acute over the past 10 years.
“When we look back, I hope we can see the tangible benefits of working together and staying the course in financing for development,” he said. “[But] you have to go step by step.”
To learn more about AIIB's work over the past decade, please visit the AIIB impact microsite.
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