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Multilateral Institutions Must Review Their Policies To Impact Development

The New Global Financial Pact Summit has agreed to further discussions on reforming multilateral development institutions.

The two-day meeting in Paris also settled on a financial compact to assist the poor in coping with climate change.

Further, there was an agreement that countries can fight poverty and confront climate change both at once.

This was announced during a joint press conference on Friday at the conclusion of the Summit attended by President William Ruto.

Also present were President of France Emmanuel Macron, International Monetary Fund Managing (IMF) Director Kristalina Georgieva, President of the World Bank Group Ajay Banga and the US Secretary of the Treasury Janet Yellen.

President Ruto stated that the session had also reached an agreement on the provision of more resources to support vulnerable countries.

He said a win-win approach had been crafted, noting that the Summit had also made progress on new global sources of financing for climate action and the plans to insulate them from national interests.

“This will move us closer to addressing the climate crisis,” he explained.

Asked if the Summit will bear results, Dr Ruto said “the ultimate judgment rests in our hands as the world will pass the verdict”.

He argued that he would prefer to see a firm commitment to deploy a portion of the new Official Development Assistance sought to provide greater fiscal space for heavily indebted countries by refinancing their maturing debts on more favourable and extended terms.

“I would have liked to see more clarity on how we will mobilise the $9 Trillion a year that the International Energy Agency informs us is necessary to maintain the goal of limiting global warming to 1.5 degrees.”

He maintained that Africa can step forward and work with other leaders in confronting the challenges that the world is facing.

“There is more creativity and technology to make this world exploit its potential and make the globe livable to everyone.”

Ms Yellen said resources generated must be used in a more impactful way to confront the challenges facing the world.

She agreed that reforms must be pursued at the IMF and the World Bank but “gradually, cautiously and meaningfully”.

“We will intensify private capital mobilisation in energy transition and sustainable infrastructure. We believe this will also spur development,” she noted.

However, she cautioned that “there is great deal of work to do”.

On his part, President Macron observed that an effective monitoring structure will help the world eliminate poverty.

“We also need a better coordination mechanism between the World Bank and the IMF.”

In a world that is changing rapidly and affected by severe shocks, IMF Managing Director said it is time to “step up our leadership”.

“We have to live up to the expectations of our positions,” she added.

Meanwhile, Mr Banga asked the world to work towards creating jobs for its growing population.

“Employment is the single best way to drive the last nail into the coffin of poverty. We must scale up our action towards this cause.”

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