As we reach the halfway point of the G20 presidency of Brazil, it is imperative to consider the proposals presented by member countries, with particular regard to Brazil’s coordination of various tracks and working groups. An important event, highlighting tangible action, occurred during the G20—Finance in Common System (FiCS) Joint Event on May 20 and 21, 2024, in Rio de Janeiro.
The FiCS event served as a platform for over 530 development banks, collectively managing assets upwards of USD 23 trillion and making annual investments of approximately USD 2.5 trillion. Discussions centred on their role in financing the Paris Agreement, the Kunming-Montreal biodiversity framework, and the UN Agenda 2030. This underscored the crucial function of development banks in promoting sustainable development and the potential for global coordination to address significant challenges.
In my capacity as the Special Envoy to the FiCS, I put forth comprehensive recommendations to G20 working groups, including the Sustainable Finance Working Group (SFWG), the International Financial Architecture Working Group (IFA WG), the Infrastructure Working Group (IWG), and the Task Force for the Global Mobilization against Climate Change (TF CLIMA). These recommendations align with Brazil’s G20 priorities, such as combatting inequality, promoting social inclusion, addressing hunger, tackling climate change, facilitating energy transition, promoting sustainable development, and reforming global governance institutions.
A set of recommendations, delineated in a document entitled “Key Takeaways and Recommendations by the Finance in Common Chairman to the Brazilian Presidency of the G 20,” outlines focus areas in the following six key domains:
1. Reform of the Global Financial Architecture
Guidance and incentives for accelerating the implementation of G20 initiatives should extend to a broader group of institutions beyond the Bretton Woods institutions and the Multilateral Development Banks (MDBs) system.
2. Setting up Country Platforms
These platforms aim to facilitate the connection of stakeholders—governments, the private sector, and civil society—to finance sustainable development, aligning UN SDGs with national development plans.
3. Ramping Up Concessional and Innovative Financial Solutions for Biodiversity and Climate
Global collaboration is crucial in addressing knowledge gaps in nature and climate efforts, as well as advancing nature-based innovations, including a platform on biodiversity.
4. Increasing Blended Finance and Private Capital Mobilization for Resilient Infrastructure
Concrete actions are necessary to attract private capital for sustainable infrastructure preparation, including generating more bankable projects and allocating more grants.
5. Scaling Local and Subnational Finance
Establishing a Green Cities Guarantee Fund can provide timely and affordable finance for urban projects, offering guarantees for city operations, municipally owned utilities, and private sector investments.
6. Removing Bottlenecks to Unlock Development Banks’ Contribution
G20 members should integrate contributions to the Paris Agreement and SDGs into Development Banks’ mandates and take specific actions to unleash their full potential.
By July 2024, when the Finance Ministers convene, a comprehensive agenda will be presented for discussion and approval, culminating in adoption at the final meeting of State Leaders in November.
The event was an embodiment of President Lula da Silva’s vision of “Building a Just World and a Sustainable Planet.” It’s a testament to collective efforts towards creating a more sustainable and equitable global financial system.
Sergio Gusmão Suchodolski
Executive Vice President, VR Investment
Brazil Institute
Latin America Program