Tag Archive for: IFIs

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Argentina’s entry into the BRICS: what does it mean?

On August 22-24, the 15th BRICS Summit took place in South Africa, where heads of state of the member countries (Brazil, Russia, India, China and South Africa, whose acronym is the acronym) met at a high-level forum to discuss key issues for the most prominent emerging economies.

“Below, we offer a google translate version of the original article in Spanish. This translation may not be accurate but serves as a general presentation of the article. For more accurate information, please switch to the Spanish version of the website. In addition, feel free to directly contact in English the person mentioned at the bottom of this article with regards to this topic”.

During the XV Summit, the Heads of State met with members of the business sector in dialogue with the New Development Bank to outline the main axes that will guide BRICS policy. This year’s agenda included the potential “de-dollarization” of global trade, with China and the yuan at the forefront of this ambition, as well as the possible effects of the Russian-Ukrainian war on cooperation between member countries. However, the emphasis was on the expansion of BRICS to include the countries that have submitted official applications for membership: Argentina, Iran, Saudi Arabia, Ethiopia, the United Arab Emirates and Egypt.

Finally, during the summit, Argentina, as well as the rest of the countries mentioned above, was formally invited to join the BRICS as from January 1, 2024. Since it is an international forum that does not imply a supranational integration process, the decision to join will be at the discretion of the Executive Power that takes office on December 10. Some of the presidential candidates, such as Javier Miliei (La Libertad Avanza) and Patricia Bullrich (Juntos por el Cambio) have expressed critical positions regarding the accession, alleging a strong difference with the international actions of the BRICS countries, especially in reference to their violations of international law, such as during the war in Ukraine.

In this sense, it is possible to identify some key elements regarding the implications of Argentina’s participation in the BRICS. Mainly, reference is made to the quantitative dimension of the BRICS group, which concentrates 40% of the world’s population and 25% of the world’s GDP, a percentage that, together, equals that of the United States (World Bank Data Center). In addition to these numbers, there are those that link Argentina specifically with the founding countries: the main recipients of Argentine exports include Brazil, China and India; while its main imports come from China and Brazil (OEC).

The role of the New Development Bank

The economic factor becomes more relevant if the possibilities of financing by the New Development Bank (NDB) are taken into account. The BRICS development bank was founded by the member nations of the bloc in 2014, during the sixth summit held in Fortaleza, Brazil. This international bank is positioned as an alternative to the IMF and the World Bank, with credits oriented mainly to infrastructure projects and which, according to the official website, prioritize “high-impact operations that are environmentally smart, resilient, technologically integrated and socially inclusive”.

Currently, the New Development Bank finances projects in only 6 countries (China, India, Brazil, Russia, South Africa and Bangladesh) for a total of US$ 32.8 billion. According to sources such as Ámbito Financiero, Argentina is already negotiating with Dilma Rousseff, who holds the presidency, a possible credit line that would help alleviate the pressure on the debts with the IMF. In order to join the NBD, Argentina must make a capital contribution of “US$250 million in sovereign bonds held by the Treasury, from the Guarantee and Sustainability Fund (FGS) of the National Social Security Administration (Anses) and other sources” (La Nación). A key element of participation in the NBD is that in their general strategy they commit to grant 30% of their loans in local currency of the recipient country, in order to mitigate the risk of foreign investment (NBD). In the case of Argentina, this could diversify the sources of financing and reduce dependence on the dollar and the IMF. However, there are still concerns about the bank’s transparency and the possibility of access to public consultations or information on the investment process (Diálogo Chino).

Since its creation, BRICS has positioned itself as an alternative multilateral cooperation forum for emerging economies, which emphasizes multipolarity and a “de-ideologized” positioning, prioritizing informal dialogue and trade exchange. In this sense, Argentina’s entry into the forum presents a space for rapprochement with the large economies of the world that are disputing an alternative model of financing for development.

 

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Author

Lourdes Álvarez Romagnoli

Contact

Gonzalo Roza – gon.roza@fundeps.org

 

*Source of the image: El Cronista

Demystifying development financing

“Demystifying Development Finance” offers insightful insight into Public Development Banks (PDBs) and their profound impact on the world. From the money they invest to the rules they set, these banks influence our lives and the well-being of the planet in ways we often underestimate.

In recent years, the PDBs have advocated playing an even greater role in addressing climate change, global poverty, and other crises. However, the case studies and evidence presented in this report show that BPDs are actually exacerbating problems they claim to solve. The push towards privatization, the extractivist and top-down approach, and the limitations of social and environmental safeguards often deepen inequalities, lead to human rights violations, fuel climate change and increase debt.

Produced by more than 100 civil society activists, this joint analysis aims to open a much-needed discussion about the role development banks play in today’s global economy and what we can do to hold them accountable.

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Inter-American Development Bank: public consultation for its new Institutional Strategy

On June 27, the IDB Group (Inter-American Development Bank, IDB Invest, and IDB Lab) announced the opening of the public consultation process for the preparation of its new Institutional Strategy. The process will be carried out through collaborations and face-to-face and virtual consultations with interested parties, including civil society.

“Below, we offer a google translate version of the original article in Spanish. This translation may not be accurate but serves as a general presentation of the article. For more accurate information, please switch to the Spanish version of the website. In addition, feel free to directly contact in English the person mentioned at the bottom of this article with regards to this topic”.

In accordance with the mandate to review and prepare the Institutional Strategy every four years, the IDB Group announced a new opening of the public consultation process. The IDB Group is one of the main sources of financing for development in Latin America and the Caribbean and is made up of the Inter-American Development Bank (IDB); IDB Invest, which works with the private sector; and IDB Lab, which focuses on developing innovative ways to drive inclusive growth.

The main objective of the consultation is to receive opinions and inputs from interested parties, among which are representatives of governments, the private sector and civil society for the development of a new Institutional Strategy. The process begins after the agreement of the main guidelines established by the Executive Boards of both the IDB and IDB Invest. Once established, the procedure is divided into two phases: the first phase consists of consultations with representatives of the government, private sector, and civil society, either virtually or in person, in the 26 borrowing member countries. In turn, it also includes the possibility that any interested party can contribute inputs through an online form that is available until August 15, 2023. The second phase begins after the approval of the new Strategy by the the Board of Governors, in March 2024, in which those who participated in the public consultation will be informed about the inputs received and will be shared with them the new Institutional Strategy of the IDB Group that will be valid until 2030.

In Argentina there are three dates established for public consultations: with civil society (08/04/23), with the private sector (08/10/23) and with the government (08/16/23). To access the dates of public consultations in the other countries, consult here. For comments or more information, you can contact the following email: consultaspublicas@iadb.org

From Fundeps we consider the opening of this process as an opportunity to strengthen the Bank’s dialogue with civil society. This is why we will participate in the process in the month of August by sending contributions to strengthen the next institutional strategy.

 

More Information

 

Author

Candela Jauregui

Contact

Gonzalo Roza, gon.roza@fundeps.org

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Argentina in the Asian Infrastructure Investment Bank: achievements and challenges

This article aims to analyze the consequences of Argentina’s entry into the Asian Infrastructure Investment Bank. The structure of the Bank is analyzed, covering its characteristics and the performance of the institution in general terms, the repercussions of Argentina’s entry are considered, contemplating advantages and disadvantages and, finally, the effects associated with joining this institution are considered. to China’s projection on the international stage.

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Approaches in the Sino-Argentina relationship: the incorporation to the AIIB and the Belt and Road Initiative

This document presents an analysis of the background and motivations that led Argentina to become a member of the AIIB and the implications that derive from it, as well as the possibility that Argentina advances in its incorporation into the BRI in the short term. In the same way, the challenges and opportunities that both initiatives represent for the country are addressed.

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Report on the first AIIB project in Brazil: renewable energy and infrastructure

The purpose of the following report is an updated approach to the first AIIB project in Brazil, including its political, economic and environmental dimensions. First, an analysis is carried out on the main characteristics of the project, context and actors involved; then, we proceed to analyze the implications for Brazil of receiving such financing; and finally, the main environmental consequences are exposed.

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Report on the first AIIB project in Ecuador

The “CONAFIPS COVID-19 Credit Line project” has made Ecuador the first Latin American country to receive a Latin American loan from the Asian Infrastructure Investment Bank. This report reviews the project, emphasizing its fundamental characteristics, context, environmental and social standards, and main criticisms and concerns about it.

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IDB Annual Meetings were held with limited civil society participation

Within the framework of the Annual Meeting of the Inter-American Development Bank (IDB), held in Panama, a group of civil society organizations met with the president of the Institution, Ilan Goldfajn, in an attempt to strengthen the link between the parties.

“Below, we offer a google translate version of the original article in Spanish. This translation may not be accurate but serves as a general presentation of the article. For more accurate information, please switch to the Spanish version of the website. In addition, feel free to directly contact in English the person mentioned at the bottom of this article with regards to this topic”.

Between March 16 and 19, the Annual Assembly of Governors of the Inter-American Development Bank (IDB) and IDB Invest was held in Panama City. It is a debate forum in which the members of the institution, together with those who preside over the central banks and other high-level authorities, discuss and address issues on issues considered to be a priority.

In the opening speech, the current president of the IDB, Ilan Goldfajn, outlined some of the institution’s priorities, which revolve around social issues such as food security, poverty, inequality, health, and education. In turn, he emphasized the mitigation of climate change and adaptation to it, stressing the need to deal with the increasingly frequent natural disasters in the Latin American and Caribbean region. The importance of preserving the biodiversity through the elaboration of an Amazon Regional Program.

The Board of Governors commissioned the preparation of a capital increase proposal for IDB Invest in order to implement a new business model that increases its impact on development through the private sector. In addition, he reiterated the importance of preparing a new Institutional Strategy proposal for the IDB Group, whose approval is scheduled for the next annual meeting in 2024.

The limited participation of civil society

After repeated requests made by a group of civil society organizations, the Bank authorized their participation in the event, although in a limited manner and closed to those who received an invitation. In addition, it was possible to arrange a meeting with the president of the IDB on March 17. In said meeting, the need to generate spaces for dialogue and express the demands of civil society in relation to the bank was raised. Both the possibility of participating in the event and the possibility of meeting with the president represent positive developments, although it remains to be seen if these are real changes in the institution. For now, the bank has invited to continue the dialogue in the coming months to achieve a more effective participation in the annual meetings of 2024.

From Fundeps we have been following and participating in this process together with organizations in the region that make up the IDB Working Group, and we will continue actively in the dialogue processes proposed by the bank.

 

More Information
– Governors endorse the vision, priorities and plans for the IDB Group | IADB
– Open letter from civil society organizations to IDB President Ilan Goldfajn – Fundeps
– The Brazilian Ilan Goldfajn is the new president of the IDB – Fundeps
– Open letter to the IDB for the election of a new presidency – Fundeps

 

Authors
Candela Jauregui
Valentina Rasso

Contact
Gonzalo Roza – gon.roza@fundeps.org

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Open letter from civil society organizations to IDB President Ilan Goldfajn

More than twenty organizations from Latin America and the United States addressed a letter to the president of the Inter-American Development Bank (IDB) Ilan Goldfajn. They ask that the Bank strengthen its work by committing itself to respect for Human Rights and the protection of the environment and that spaces be created for greater articulation with civil society.

“Below, we offer a google translate version of the original article in Spanish. This translation may not be accurate but serves as a general presentation of the article. For more accurate information, please switch to the Spanish version of the website. In addition, feel free to directly contact in English the person mentioned at the bottom of this article with regards to this topic”.

The organizations, members and allies of the Coalition for Human Rights in Development alluded in the letter to the commitment assumed by Goldfajn in his inaugural speech as president of the Bank to “take advantage of all opportunities for dialogue” and collaboration with governments, the sector private sector, academia and civil society to solve regional problems.

To strengthen the articulation with civil society, the organizations urged the Bank to open a space for dialogue with civil society at its Annual Meetings, not only because it is a good practice implemented by other multilateral organizations, but also because it is a unique opportunity. to include communities affected by projects.

Since 2017, the group of signatory organizations of the letter has been monitoring and enriching the Bank’s policies and projects that it hopes to continue carrying out. The organizations have contributed to the IDB Environmental and Social Policy Framework, updates to the Independent Consultation and Investigation Mechanism policy, and the Bank’s Access to Information Policy review process.

The organizations seek the IDB to ensure in its practices and operations the promotion and respect of Human Rights, particularly of indigenous peoples, and the protection of key ecosystems in the fight against climate change.

The next Annual Meeting of the Boards of Governors of the IDB and IDB Invest will be held in Panama from March 16 to 19.

Signatory organizations:

  1. Accountability Counsel
  2. AMATE El Salvador
  3. Articulación Salvadoreña de Sociedad Civil para la Incidencia en las Instituciones Financieras Internacionales (ASIFI)
  4. Asociación Ambiente y Sociedad
  5. Asociación Interamericana para la Defensa del Ambiente (AIDA)
  6. Bank Information Center
  7. Center for International Environmental Law (CIEL)
  8. Coalición para los Derechos Humanos en el Desarrollo
  9. Cohesión Comunitaria e Innovación Social A.C. (México)
  10. Conectas Direitos Humanos
  11. Derecho, Ambiente y Recursos Naturales (DAR, Perú)
  12. Ecoa – Ecologia e Ação
  13. Fundación para el Desarrollo de Políticas Sustentables (Fundeps)
  14. Fundación CAUCE: Cultura Ambiental – Causa Ecologista. (Argentina)
  15. Gender Action
  16. International Rivers
  17. International Accountability Project
  18. Mesa de Discapacidad y Derechos (Perú)
  19. Plataforma Internacional contra la Impunidad
  20. Protection International Mesoamérica
  21. Sociedad y Discapacidad – SODIS (Perú)
  22. Sustentarse (Chile)
  23. Wetlands International / Fundacion Humedales (Argentina)

Read the full letter here: Letter to IDB President

 

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Comments to strengthen the IDB’s Access to Information Policy

After participating in a series of face-to-face and virtual public consultations, a group of Civil Society Organizations (CSOs) from the region sent comments and suggestions to the IDB in the framework of the revision of the Bank’s Access to Information Policy.

“Below, we offer a google translate version of the original article in Spanish. This translation may not be accurate but serves as a general presentation of the article. For more accurate information, please switch to the Spanish version of the website. In addition, feel free to directly contact in English the person mentioned at the bottom of this article with regards to this topic”.

On December 28, 2022, the deadline established by the Inter-American Development Bank (IDB) for sending comments on the draft of the institution’s new Access to Information Policy (PAI) ended. Thus concluded the Second Phase of the Public Consultation Process approved by the Bank and which lasted 90 days.

Within this framework, together with a group of Civil Society Organizations in the region, we sent a document with comments and recommendations in relation to the Draft Policy prepared by the Bank, which, although it incorporates some positive advances, is not enough to guarantee the right of access to information effectively in relation to the actions of the Bank and its customers.

Among the main recommendations and suggestions highlighted in the document, the following stand out:

  • Commitment to access to information as a fundamental human right. The Bank must establish clear commitments to guarantee respect for access to information as a fundamental human right. The right to information is also a key access right for the exercise of other fundamental rights, such as the consultation, participation and involvement of people and communities impacted by projects in decisions that affect or may have an impact on their ways of life. .
  • Implementation Guidelines. It is concerning that some criteria and parameters that will make the PAI effective are left to be addressed in the Implementation Guidelines. In this way, the effectiveness and force of the PAI will depend a lot on the Implementation Guidelines that do not require mandatory compliance as the PAI itself does. In turn, these Guidelines should be consulted through a meaningful participatory process with civil society.
  • Language ambiguity. The PAI contains a lot of ambiguous language and vague and diffuse commitments, which opens the door to different interpretations, including breaches and serious misconduct. Likewise, it prevents the establishment of clear requirements for the borrowers and also the responsibilities of the Bank itself. The Policy must avoid flexibility and ambiguity of language to prevent the use of discretion and non-compliance with respect to its guidelines.
  • Specification of what information is going to be published proactively, disclosure times, in what formats, channels and deadlines. The PAI must clearly establish what information it is going to proactively publish, through what channels or media, in what formats and in what terms. In turn, response times to requests for information are excessive, and the IDB reserves the right to extend these terms indefinitely. The Bank must define shorter and clearer terms in terms of its responses to requests for information, and must be aligned at least with the currently applicable international standards.
  • Country or customer proprietary information. Although the elimination of the “Exception specific information of countries” is celebrated, there is concern that other points of the policy may end up undermining the principle of maximum disclosure and the openness that is intended with such elimination.
  • Exceptions. The exceptions must be more precise and clear criteria must be established for their application, as well as the identification of the specific documents or information to which access will not be given under the exception.
  • Damage assessment. The inclusion of the assessment of the damage for the application of the exceptions is celebrated. However, clear criteria and scales must be specified to delimit its application. If an effort is not made to define these criteria and procedures in the body of the Policy (and leave them for the Implementation Guidelines), there is a risk that during their application discretionary use of exceptions will end up prevailing on the part of the Policy. of the Bank and borrowers. It is recommended to incorporate the criterion of public interest in the damage assessment, as a counterbalance to the damage, and to make the results of the damage assessment public in each specific case.
  • Open data, simple language, accessible formats and usability of the information. The information that is disclosed and published must be useful for those who request it, especially for the communities affected by IDB projects, paying attention to marginalized groups, such as indigenous peoples, Afro-descendants, people with disabilities, women, the LGBTIQ+ population, among others. others. The accessible format, the simple language and the generation of open data are related to the usability of the information. It is recommended that the IDB address the issue of accessible formats, simple language, and open data in more detail and in a transversal manner throughout the PAI, taking into account the importance of this aspect, especially for marginalized groups.

It should be noted that a large part of the recommendations and suggestions contained in the document were previously raised in the framework of the public consultations carried out by the IDB, both online and in person in Montevideo, Bogotá and Washington DC. Precisely, from Fundeps we participated in the face-to-face public consultation in Montevideo, Uruguay on November 15, 2022.

We hope that the inputs provided by civil society are considered by the Bank and contribute to strengthening the draft Access to Information Policy proposed by the institution, which is far from incorporating the highest standards in the matter.

To access the complete document with comments and suggestions sent to the IDB, access here

 

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Contact

Gonzalo Roza, gon.roza@fundeps.org

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The Brazilian Ilan Goldfajn is the new president of the IDB

On November 20, the Board of Governors of the Inter-American Development Bank (IDB) appointed Brazilian candidate Ilan Goldfajn, former president of the Central Bank of Brazil and current director for the Western Hemisphere of the IMF, as its new president. After withdrawing the candidacy of Cecilia Todesca, the government of Alberto Fernández supported the candidate promoted by Brazil.

“Below, we offer a google translate version of the original article in Spanish. This translation may not be accurate but serves as a general presentation of the article. For more accurate information, please switch to the Spanish version of the website. In addition, feel free to directly contact in English the person mentioned at the bottom of this article with regards to this topic”.

On September 26, following the recommendations of the Board of Executive Directors, the Board of Governors of the IDB announced the termination of the executive functions of Mauricio Claver-Carone. After the announcement, and through an official statement, the selection process of the person in charge of the next presidency of the institution began.

The Board of Governors, the IDB’s highest authority, is made up of representatives of the 48 member countries, whose voting power varies according to the capital that the country subscribes to the institution. According to the organization’s press release, “to be elected, the candidate must obtain a majority of the voting power of the IDB member countries, as well as the support of at least 15 of the 28 regional member countries.”

In this way, the candidate must consecrate himself with the majority of the voting power of the member countries to be elected. Voting power fluctuates according to the number of shares owned by each state. The largest investor is the United States, which with 30% of the total funds has a key role in the election. They are followed by Argentina and Brazil, with 11.3% each. Mexico accounts for almost 7.3%, Japan 5%, Canada 4%, Venezuela 3.4% and Chile and Colombia 3.1%. The rest is divided into small percentages from different countries.

The new president of the Bank will assume his functions for a period of five years with the possibility of being re-elected only once, and will be responsible for managing the daily affairs of the Bank, as well as managing its operations together with the Presidential Office. The president also formulates proposals on the Bank’s general policy and presides over the meetings of the Board of Directors, being able to vote only in case of a tie.

The alliances behind the election

The new president-elect was consecrated with 80.8% of the votes, and was proposed by the government of Jair Bolsonaro in view of a candidate who would bring consensus to the region after turbulent periods for the Bank, following the dismissal of the former president Mauricio Claver-Carone for violations of the code of ethics. In this way, and thanks to the support of the United States, Canada, and at the last minute from Argentina, Ilan Goldfajn managed to position himself as the new president of the IDB.

It is worth noting the late support of Alberto Fernandez to back the candidacy of the Brazilian; despite his intention to position Cecilia Todesca Bocco as the first woman and the first Argentine to preside over the IDB. However, as a result of the change in its position and the support for Goldfajn, Argentina managed to keep three positions: the Vice Presidency of Sectors, the Infrastructure Management, and a new Institute of Gender and Equality, which will be part of the new management of the IDB.

With annual loans of around 14,000 million dollars, the IDB is the largest source of financing in the region and the change of leadership is essential for the institution to refocus its attention on Latin America after two years of a US presidency.

Prior to the appointment of Goldfajn, from Fundeps and together with a group of civil society organizations in the region, we present an open letter in which we urge those who make up the Board of Governors of the IDB to ensure a transparent selection process and urge the Bank to ensure that the designated person has:

  • Knowledge of the region and experience working with its institutions and communities.
  • Commitment to human rights, sustainable development and the work of human rights defenders.
  • Comprehensive experience and vision on sustainability and environmental protection.
  • Commitment and openness to include civil society and communities affected by the projects.
  • That it prioritize the discussion for the development of a framework for reparation to the affected communities.
  • Lead by example and act in accordance with the highest ethical standards.
  • Commitment to regional and international agreements and treaties that address climate change, the protection of biodiversity, the defense of human rights and sustainable development.

It remains to be seen if Goldfajn, in the course of his tenure, manages to live up to and meet at least part of these requirements. In any case, we believe that a historic opportunity has been wasted to finally position a woman in the presidency of the Bank, a pending account of this type of multilateral institutions. Beyond the progress made by the IDB in generating job opportunities for women and their number in management positions, it is estimated that 3 out of 14 seats on the executive boards are occupied by women; in the alternate executive directorates, out of 12 chairs, only one is occupied by a woman. What gives rise to the claim to this type of organizations to promote specific spaces for participation for women and dissidence in the most hierarchical positions, which allow breaking the glass ceiling.

More information:

Authors:

Candela Jauregui

Clara Labat

 

Contact:

Gonzalo Roza, gon.roza@fundeps.org

 

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Open letter to the IDB for the election of a new presidency

Given the opening of a new election process for the presidency of the IDB group, civil society organizations in the region and communities affected by projects, we sent an open letter with recommendations on the profile of who will preside over the Bank.

“Below, we offer a google translate version of the original article in Spanish. This translation may not be accurate but serves as a general presentation of the article. For more accurate information, please switch to the Spanish version of the website. In addition, feel free to directly contact in English the person mentioned at the bottom of this article with regards to this topic”.

In the letter we urge those who make up the Board of Governors of the IDB to take advantage of this opportunity so that the person who is selected is someone with probity, capable of leading the transformations that the institution requires today and of effectively facing the emergencies and environmental and social challenges in Latin America and the Caribbean.

Likewise, we consider that the job description must be clear, the selection process transparent, and we urge the Bank that the person who is selected have:

  • Knowledge of the region and experience working with its institutions and communities. Commitment to human rights, sustainable development and the work of human rights defenders.
  • Comprehensive experience and vision on sustainability and environmental protection. Commitment and openness to include civil society and communities affected by the projects.
  • That it prioritize the discussion for the development of a framework for reparation to the affected communities. Lead by example and act in accordance with the highest ethical standards.
  • Commitment to regional and international agreements and treaties that address climate change, the protection of biodiversity, the defense of human rights and sustainable development.

The election is scheduled for November 20, with voting power varying according to the number of shares held by each member country. The person who is finally appointed to the presidency of the IDB Group has the opportunity to lead a Bank that is stronger, more responsible, more effective and, above all, closer to the peoples of the region, leading the way towards truly sustainable and inclusive development.

Contact

Gonzalo Roza – gon.roza@fundeps.org