The Summit for a New Global Financial Pact opened in Paris yesterday with a speech by French President Emmanuel Macron on the importance of investment for emerging countries. The Head of State stressed the need to mobilize the private sector and more investment in developing countries and major emerging countries, with a view to combating poverty and biodiversity.
The summit aimed to find solutions to tackle climate change, inequality and poverty, ranging from debt relief to climate finance. Several dozen foreign leaders were present at this summit, including heads of state of African countries, Chinese Premier Li Qiang and Brazilian President Lula. The topics raised by developing countries aimed to push multilateral development banks, such as the World Bank, to take more risk with their capital to stimulate lending.
The prospect of a new global financial pact is encouraging, especially for developing countries which often need capital to grow, but it is questionable whether developed countries will be willing to take enough risk to support these countries. In addition, the lack of confidence in financial institutions that has been amplified by the recent economic crisis has raised concerns about the ability of financial institutions to meet the expectations of developing countries.
Private investment can play an important role in the economic growth of developing countries, but it is also important to ensure that investments are distributed equitably, so as to benefit the most vulnerable populations. Developing countries need capital to finance infrastructure, health and education projects, but private investors may sometimes not be sensitive enough to social and environmental aspects. It will therefore be up to international organizations to monitor the impact of private investments and ensure that they really contribute to the sustainable economic development of developing countries.
In conclusion, the Summit for a new global financial pact has opened up interesting prospects for the economic development of developing countries. However, it will be necessary to ensure that private investments are sufficiently supervised to guarantee a real and lasting impact on populations and the environment. Developed countries also have a role to play by taking risks to support developing countries and holding financial institutions accountable.