Cartagena, Colombia, Sep 6 (EFE).- The Finance in Common Summit (FiCS), the world’s largest gathering of development banks, concluded on Wednesday in the Colombian port city of Cartagena with a united commitment to further the UN’s sustainable development goals (SDGs) aimed at protecting the most vulnerable and preserving common global goods.
“Participants shared their commitments and methodologies to align operations, strategies, and institutions with the SDGs and acknowledged the risk of fragmentation due to the proliferation of specific frameworks and taxonomies on sustainable finance,” said Remy Rioux, Executive Director of the French Development Agency (AFD), as he read the FiCS’s final statement during a press conference.
This marked the first time the event, co-organized by the Inter-American Development Bank (IDB), the Colombian Business Development Bank (Bancoldex), and the Latin American Association of Financial Institutions for Development (Alide), was held in Latin America.
The summit gathered delegates from major international and national development banks, multilateral agencies, and representatives from various countries’ governments.
SENSE OF URGENCY
According to the final statement, participants shared an urgent sense and are prepared to do more to “protect the most vulnerable populations and preserve common goods.” They also reaffirmed their commitment to “share and implement best practices, norms, and internationally accepted standards on environmental, social, and governance policies.”
A key aim is to mobilize public capital to enhance green loans in a socially just manner. Nature-based solutions were also recognized as “key components” for mitigating vulnerability to climate change and achieving social inclusion, among other benefits.
FiCS attendees also agreed to establish a Financial Innovation Lab to bolster cooperation amongst its members and better equip them.
“The lab will prioritize incubating the following innovations: the generalization of disaster-related debt clause contingents; parametric contingency financing and credit lines, and innovative risk transfer solutions for vulnerable communities,” the statement said.
Furthermore, signatories concurred that significant capability needs to be built within the public development bank system to “address challenges related to climate change and meet the SDGs.”
CONTRIBUTING TO INTERNATIONAL FINANCIAL ARCHITECTURE REFORM
Lastly, FiCS members pledged to contribute to the reform of the international financial architecture, for which they proposed several suggestions to national authorities.
One proposal involves strengthening public development banks and aligning their operations with sustainable development goals through incentive policies and regulatory frameworks. The plan also includes promoting common methodologies for institutional alignment with the SDGs and “the characterization of investments compatible with sustainable development goals.”
According to IDB data, there are roughly 520 public development banks with $23 trillion in assets, responsible for $2.7 trillion in development financing in 2022, or 12% of global investment. EFE.