Multilateral development banks (MDBs) have played a crucial role in supporting economic development and fighting poverty over the 70 years since the creation of the World Bank, at the Bretton Woods conference. However, the World Bank and major regional multilateral banks are considered by many – particularly in developing countries – to be too inflexible, bureaucratic and dominated by the political interests of wealthy non-borrowing shareholder countries.
Developing countries are creating their own purpose-built bilateral, regional-bilateral and multilateral institutions to provide market-based public lending. Several have long and successful track records, such as the CAF (Corporación Andina de Fomento, now called the Development Bank of Latin America) and the Central American Development Bank. The newest of these are the BRICS’ New Development Bank (NDB) and the Asian Infrastructure Investment Bank (AIIB), where Chinese leadership played a large role in setting them up.
Now, more than ever, there is a pressing need to review whether the existing mandates, structures and instruments of MDBs will fulfil adequately their evolving objectives.
This paper brings together three different perspectives from leading experts to address some of these questions and shed some light on the challenges ahead for the architecture of MDBs. They are not meant to provide definitive answers but to spark debate, and they have to be considered stand-alone opinions.