DELEGATION REPORT: 2017 WB-IMF Spring Meetings
Executive Summary
The Young Diplomats of Canada (YDC) delegation to the World Bank (WB) and International Monetary Fund (IMF) Spring Meetings represented the voices of Canadian youth in international, cross-sector discussions on the greatest challenges facing the global economy and the most promising opportunities to end poverty and promote inclusive and sustainable growth.
The delegation participated in sessions hosted by the WB and IMF, as well as the Civil Society Policy Forum organized in conjunction with the Spring Meetings to allow a diversity of perspectives to be shared. The delegation also had a robust private program focused on the Spring Meetings agenda as well as the bilateral relationship between Canada and the United States (US). These two strains were highly intertwined, with these being the first Spring Meetings to occur since the new US administration was sworn in. The YDC delegation witnessed first-hand Canada’s strong engagement and leadership in the WB and IMF, led by the Minister of Finance, William Morneau, and Minister of International Development, Marie-Claude Bibeau. Both Ministers held bilateral meetings with the YDC delegation, providing an opportunity for YDC to discuss with the highest levels of the Government of Canada the priorities of Canadian youth with regard to global governance, economic growth, official development assistance, humanitarian relief, and other issues.
To gain insight into the vitality of the Canada-US bilateral relationship, the YDC delegation met with a range of key actors from within and outside government, including the Embassy of Canada in Washington (Denis Stevens, Deputy Head of Mission), the State Department (Office of Canadian Affairs), leading centres of expertise (Canada Institute at the Wilson Centre and the Paul H. Nitze School of Advanced International Studies), and other experts (Adrian Morrow, Washington correspondent for the Globe and Mail).
To complement participation in the Spring Meetings, the delegation also arranged private meetings with Canada’s representatives to the WB and IMF, as well as thought leaders and key actors in international development. These included Mahmoud Mohieldin, the World Bank Group Senior Vice President for the 2030 Development Agenda, United Nations Relations, and Partnerships, who encouraged YDC to engage with the WB and particularly the “Ideas for Action” competition. The delegation also met John McArthur at the Brookings Institution, who offered insights on Canada’s opportunity to demonstrate global leadership on emerging issues, such as skills and the future of work. Finally, the delegation visited the UN Foundation and met the leaders of several initiatives aimed at empowering girls and utilizing digital tools for global impact. The delegation also played a leadership role in convening other youth delegates at the Spring Meetings and organized an informal gathering for delegates from countries such as France and Brazil.
YDC was privileged to send a representative to the Carbon Pricing Leadership Coalition’s Second High Level Assembly, which mobilized governments, leading corporations, and environmental experts and civil society to advance carbon pricing policies that drive clean innovation. The Assembly marked the start of Canada’s term as Co-Chair of the Coalition.
Key Forum Sessions Attended
World Bank Spring Meetings
April 19
Chief Economists Roundtable: The Road to 2030
In this session several Chief Economists within the WB reflected on challenges and solutions in international development, with a particular emphasis on investing in human capital and addressing infrastructure gaps. The discussion was highly pragmatic, focusing on the need to clarify desired outcomes before identifying financing targets, and the importance of making the most efficient use of public funds. As Paul Romer, Senior Vice President and Chief Economist of the WB put it, referencing an old trope, “everyone wants growth, but no one wants change.” The discussion highlighted the need to examine outcomes in terms of variance, not just in terms of mean, with a view to ensuring support for the poorest and most vulnerable.
April 20
Generation Now: How Investing in Adolescents Today Can Change the World of Tomorrow
This session provided a platform for unparalleled global influencers - including Melinda Gates, Marie-Claude Bibeau and Jim Yong Kim - to highlight how integrated and high-impact investments in adolescents are a force multiplier, accelerating progress across a range of development areas, namely health, nutrition, education, skills and social protection. These investments can transform life expectancy and opportunities for young people living in poverty, thus improving country-level opportunities for inclusive, sustainable growth and resilience.
This is an urgent issue - ninety percent of today’s 1.2 billion adolescents worldwide live in the developing world, and frustrated aspirations due to stagnated growth can lead to extremism and migration. Disarming adolescents in conflict areas is a critical, yet often overlooked, approach to investing. The panel also highlighted the importance of prioritizing adolescent girls. This includes not just targeting policies that impact girls, but also improving the quality and quantity of data informing investments. All panelists echoed the importance of including communities in the conversation about their needs and strategies to fulfill them.
Carbon Pricing Leadership Coalition (CPLC) Second Annual High Level Assembly
Adam attended the CPLC High Level Assembly -- aimed at catalyzing wider adoption of carbon pricing policies -- and was among the only youth delegates at the meeting, which brought together governments (including many Prime Ministers and Ministers of Finance from developing and developed countries), leading corporations (Royal DSM, co-chair, as well asBNP Paribas, HSBC Holdings, Lafarge Holcim, pension funds, and more), thought leaders (Christiana Figueres, who spearheaded the Paris Agreement on climate change, and Lord Nicholas Stern), and key non-governmental actors (Children’s Investment Fund Foundation). Canada began its term as co-chair of the CPLC, and MP Jonathan Wilkinson, Parliamentary Secretary to the Minister of Environment and Climate Change, co-chaired the Assembly on the Minister’s behalf.
The eclectic list of participants was remarkably aligned on the value of carbon pricing in creating the conditions for accelerated clean innovation to address climate change. However, those in the room were well aware that the number of large jurisdictions with carbon pricing systems in place is still quite small, and Canada, having announced last year a national approach to carbon pricing, stood out. Colombia highlighted its adoption of a (relatively low) carbon price, with tax revenues earmarked for investments in environmental restoration, with a particular focus on repairing environmental damage resulting from the protracted armed conflict in that country. The Executive Deputy Comptroller of New York City offered a valuable perspective on leveraging massive pension funds to bolster green investment. The Children’s Investment Fund’s intervention challenged the Coalition to more forcefully resist opposition to carbon pricing and to guide emissions-intensive industries on a path to deep decarbonization by recycling revenues amassed from carbon pricing schemes. Adam connected with the leader of the youth-led “Put a Price on It” campaign in the US and will be following up to discuss the campaign in further detail.
Implementing the 2030 Agenda: From Commitment to Action
This particular session objective was to reinforce the critical role of the World Bank Group as a leader in the implementation of the SDGs and the 2030 Agenda. Mahmoud Mohieldin, WBG Senior Vice President for the 2030 Development Agenda, United Nations Relations, and Partnerships, acted as the moderator and four other disguised panelists were invited to share their experience on how they have been implementing the Agenda in their home countries.
Following the adoption of the Agenda 2030, global development has entered a new stage. As the title refers to “Commitment to Action”, commitments have been taken during a series of international forums including important summits in 2015: Finance for Development Summit, the United Nations Sustainable Goals Summit and COP21. After a year of implementing the 17 Sustainable Development Goals, global development has been able to reach a larger extent and hopefully a greater impact with time. However, now it is time to measure the first results in order to monitor the completion of 2030 Agenda. Therefore, the WBG has published the report entitled “The Role of the World Bank in the Implementation of the Sustainable Development Goals” and a second report was launched during this same session. The “Atlas on the Sustainable Goals” report serves as the first publication offering the WBG’s perspective on the world’s progress towards each goal. These two reports were referred to by the different speakers throughout the event.
In conclusion, the distinguished panelists came to a common consensus on the actions the WBG must take in order to implement the 2030 Agenda. First they affirmed that the WBG needs to expand funding in fragile and conflict affected states for both public and private sectors. Second, they must enhance support to low and middle-income countries, and further integrate global public goods into business model. In other words, the WBG needs to scale up its financing mobilization efforts, again from both public and private sources. Thirdly, the WBG must expand partner funding sources and help countries to better use their resources, including restricting illicit financial flows.
Furthermore, Mahmoud Mohieldin confirmed that the next major meeting regarding this global initiative will take place during second UN High Level Political Forum on Sustainable Development in New York. In July 2017, 43 countries will meet and discuss the overarching theme of “Eradicating Poverty and Promoting Prosperity in a Changing World”.
April 21
Addressing the Refugee Crisis in Middle Income Countries
This was a highly engaging session aimed taking stock of the Global Concessional Financing Facility (CFF), the World Bank’s most significant effort thus far to support middle-income countries hosting large numbers of Syrian refugees, primarily Lebanon and Jordan. Refugee crises represent major economic and social shocks and incur significant costs to host countries who are providing a global public good. Middle-income countries do not have access to multilateral development financing at the same levels of concessionality as lower-income countries, and most host countries do not deem it feasible to take on additional debt or use scarce development resources for non-nationals. The CFF provides development support on concessional terms to middle income countries impacted by refugee crises.
This session offered perspectives from the CFF beneficiaries -- Jordan’s Minister of Planning and International Cooperation and Lebanon’s Deputy Prime Minister -- as well as major donor governments (Canada, represented by Minister Bibeau, as well as the United Kingdom Sweden, and Netherlands) as well as key leaders from the United Nations and WB, most notably the UN High Commissioner for Refugees Filippo Grandi. There was a clear consensus that the CFF has proven effective in lowering the cost of borrowing to help host countries invest in infrastructure and in meeting the needs of their populations. Jordan emphasized the importance of utilizing refugees’ economic potential and highlighted progress in providing legal work permits to refugees. Lebanon warned that the country could face “social collapse” if the population’s discontent is not addressed and if critical systems are further strained, notably the health care system which currently has rejection rates as high as 40% for intensive care and pediatric care. Lebanon has a $10 billion infrastructure plan and is requesting assistance in the form of grants. Donor governments reflected on the need to strengthen the WB’s capacity to support refugee-hosting countries. Minister Bibeau highlighted the need for significant psychosocial support for refugees. The Netherlands suggested that in addition to mechanisms like the CFF, it is important to support refugee-hosting countries by increasing trade and investment (e.g. removing barriers for Jordanian products to enter the European Union market). This session demonstrated that innovative financing mechanisms can yield significant benefits for the countries most dramatically impacted by the worst humanitarian crisis since the Second World War.
International Monetary Fund Spring Meetings
One of the most topical set of sessions at the IMF Spring Meetings were those focusing on how innovation affects the economy and people’s lives, and how to adapt to change. Two specific sessions within this category stood out - 1) Walter Isaacson, the head of the Aspen Institute, in conversation with Christine Lagarde (April 19th), and 2) Steven Mnuchin, the US Secretary of the Treasury, in conversation with Christine Lagarde (April 22nd). In both sessions, the speakers acknowledged that technology is the driver of economic growth, both for individual country economies, as well as for the global economy. Mnuchin focused on domestic growth, making the case that sustained growth of the US economy is good for global growth (ie. all boats rise in high tide). Mnuchin recognized that there are winners and losers in global trade, but stopped short of recognizing that the same applies to technological progress. In contrast, Isaacson tackled the nuances of global inequality as a result of automation. Isaacson’s perspective was that global governance institutions have a critical role to play in suggesting regulation to tackle income inequality, while Mnuchin’s perspective was that the global landscape, and the US particularly, has swung too far in favour of restrictive regulation, which has hurt businesses and caused a period of low growth.
Although the contrast between the two sessions was fascinating, Isaacson gave more a substantial examination of the state of AI, it’s impact on the world to date, and how to manage impacts to maximize opportunity while reducing harm. Isaacson predicted that healthcare, education, and finance are the three industries most ripe for disruption. His advice for young people was not to learn one narrow vertical, and to ensure that they were well-versed in critical and creative thinking. In short, arguing for STEAM education (science, technology, engineering, arts and mathematics) rather than STEM. Canada’s political leaders have echoed these comments, understanding both that skills training is crucial to support workers in fields that will be automated in the near-term, and that maintaining a blended focus on technology and humanities best positions students for the jobs of the future that will be created due to AI advances.
April 19
FinTech and the Transformation of Financial Services
FinTech and its emerging technologies were on everyone’s lips at the Springs Meetings. As technological advances are transforming the capital markets environment, from payments systems to robot financial advising, large financial institutions must become resilient and develop corporate agility to cope with the upcoming challenges.
Canada was represented on the panel with Mrs Wilkins, Senior Deputy Governor of the Bank of Canada. As a central banker, Mrs. Wilkins expressed her concerns about the impacts of blockchain technology, machine learning and artificial intelligence on financial stability. FinTech will inevitably change the structure of the capital markets but it will also have benefits for the once excluded and unbanked segments of the economy both in developed and emerging countries. In developing countries, Kenya for instance, the mobile payments system M-Pesa has reduced the gap between skilled and unskilled households’ access to financial services. However, these shadow banking institutions are hard to monitor for central banks as their role is to legislate policies and ensure financial stability in the banking sector. FinTech can help eradicate extreme poverty through financial inclusion, reduce the risks of instability caused by wealth inequalities and in the long term boost prosperity and inclusive growth.
The key message from the panelists was that technological advances, or creative destruction, have always been an integral part of capitalism. Banks, or at least the early adopters, will need to develop partnerships with FinTech providers if they want to enhance the efficiency of their financial technologies and survive in an increasingly competitive landscape.
April 21
Closing Gender Gap in Finance
Organized by the Toronto Centre for Global Leadership in Financial Supervision, this high level session aimed to highlight the importance of gender equality and women’s economic participation in order to ensure economic development and achieving the United Nations 2030 Sustainable Development Goals. These two principles are actually key drivers to eliminate the gaps in women’s access to and use of financial services that still persists in many countries. The session was primarily addressed to financial sector regulators, supervisors from central and affiliated organizations, official from international development agencies, as well as the board and staff of the WB and IMF. The panelists discussed how to close the gender gap in finance by first acknowledging that a gap in usage of financial services by women relative to men still persists. They also agreed that there is even larger gender gap in management of financial institutions. Then, they discussed the most effective policies and practices in order to increase access and usage by women. They agreed that this policy need to be local specific, adapted to a community or region’s needs. Furthermore, data collection and analysis especially regarding usage is essential to critically assess efforts. Finally, they affirmed that the promotion of women’s participation on boards and senior management teams of financial institution and financial supervision agencies is essential to expand perspectives at the top of an organization. Studies have proved that that companies with women directors deal more effectively with risk. Not only do they better address the concerns of customers, employees, shareholders, and the local community, but also, they tend to focus on long-term priorities. Female directors also serve as role models, and therefore, improve female employees’ performance and boost companies’ images. Finally, the promotion of financial boards with a broader composition represents the key milestone in order to achieve the Sustainable Development Goals.
Canadian Ministers Bill Morneau and Marie-Claude Bibeau participated as guest speakers to this event and shared their remarks on this topic.
Civil Society Policy Forum
April 19
How Civil Society can Engage and Activate a Youth Role in the Accomplishment of the Agenda 2030, by Taking Action and Keeping Government Accountable
This seminar aimed to provide a platform for youth who are leading efforts to engage millennials and influence governments in advancing progress towards Agenda 2030. The session was moderated by Youth representatives of AISEC.
Youth represents today, our demographic group has never been so large in human history. Therefore, AISEC representatives explained that investing in Youth represents an enormous opportunity to enhance development. Different guest speakers elaborated on their own experience and the establishment of simple frameworks allowing organizations from different sectors to identify entry-points in working with youth around the 2030 Agenda and the implementation of the Sustainable Development Goals. The session included panelists: Juan Pablo López, Housing and Urban Development Division- Urban Youth Chief Project, Inter-American Development Bank, Wilson Frota Dias de Carvalho, Senior Knowledge Management Officer, Latin America and Caribbean Region – The World Bank Group, Franklin Morales, Founder, Indigo Youth Leadership Community, Anna Molero, Senior Director of Government and Multilateral Partnerships, Teach for All.
Building Community Resilience to Natural Resource Conflict
Natural resources often prove to be flashpoint for corruption and violence, even though they have the power to improve the lives in fragile and conflict-affected countries through investments, jobs and international attention. Representatives from American University, the World Wildlife Fund, Conservation International and Search for Common Ground discussed ways donors and government can work together with community based organization and civil society to manage natural resource competition. Three quarters of the most vulnerable population live in either poor areas or in natural resources dependent area. To this effect, panelist urged governments, NGOs and Civil society members to take action and improve collaboration as much as cooperation to prevent any natural resource conflict and address fragility issues around the globe.
April 21
The World Bank in an Age of Populism: What does the rise of populist governments mean for the World Bank and its relationship with Civil Society?
A conversation with Ray Offenheiser, the President ofOxfam America, Masood Ahmed, the President of Center for Global Development, Alex Thier, the Executive Director ofOverseas Development Institute and Shawn Donnan, the World Trade Editor of the Financial Times as well as Caroline Anstey the former managing Director of the World Bank focused on the loss of trust in government, the sense of a rising menace and the concentration of wealth that feed today’s populism movement while lowering the citizens’ expectations. As they explained how globalization 3.0 is the movement of people, the panelist also explore the issues underlying in this new globalization and the lack of preparedness to the rising inequalities and disparities. Simultaneously, they explained clearly that the rising expectations of living conditions by showing that everyone can witness a neighbor with a “better life” and hope to achieve it one day. This rise of expectations about life paired with the inability of governments to actually fulfil it cause the drive in populism witnessed around the globe.
The experts also exchanged ideas about the state of the social contract nowadays and how working hard does not mean being better off anymore. They raised the question of how countries will be able to deal with the changes to come and how they can face the politics of envy and need currently experienced. To answer those questions, the panelist put a strong emphasis on starting a conversation now about the globalization 3.0 issues at the risk of putting breaks to the movement itself if it is not done. Basically, the way we approach inclusion needs to be updated to face the rising threat of populist governments.