2.3.4 Multilateral Development Banks
The Multilateral Development Banks (MDB) have seen technology transfer as part
of their mission to encourage development. More recently they started to focus
on the challenges of the environment and the specific problems involved in transferring
environmental technology. In response many have started to develop a range of
initiatives and activities.
In particular, development banks have become aware of the role they can play
in helping to mobilise private capital to help meet the needs of sustainable
development and the environment, and of the potential to use financial innovation
to encourage environmental projects and initiatives. While much of the earlier
work they did was sporadic, the private sector arms of the Multilateral Development
Banks are now seeking to identify ways they can work with international private
capital to help address environmental and developmental needs.
The World Bank, including its affiliate the International Finance Corporation,
has developed a number of initiatives with the potential to support environmental
technology transfer. These include financing a number of environmental lending
programmes at domestic financial institutions, meant for local industries. An
important new initiative is the Carbon Investment Fund. This is a vehicle which
will provide additional finance for CO2 mitigating
projects in return for carbon offsets, i.e. the right to transfer the credit
for the CO2 saved to the investor. It is expected
to have a substantial private sector component.
The European Bank for Reconstruction and Development (EBRD), is the only one
to have sustainable development incorporated in its charter. It is also quite
active in working with the private sector . Thus it is not surprising that it
has shown a fair amount of leadership in helping to encourage technology transfer.
Examples of its initiatives include working with intermediary banks to educate
them on environmental issues and the potential of clean technology, and activities
to support the development of Energy Service Companies.
Other MDBs, such as the regional development banks (African Development Bank,
AfDB, Asian Development Bank, ADB, Inter-American Development Bank , IDB) all
play an important role in regional investment, and most have given some attention
to issues of sustainable development, in varied ways. The European Investment
Bank is also a huge investor, internationally particularly to the Asia-Pacific-Caribbean
countries under the Lomé Convention; its investment programmes however
have not generally been co-ordinated with the EU's goals on sustainable development
and climate change.
Governments can use their leverage to direct the activities of multilateral
development banks through their respective Boards and Councils in order to:
- Strengthen MDB programmes to account for the environmental consequences
of their lending;
- Develop programmatic approaches to lending that remove institutional barriers
and create enabling environments for private technology transfers;
- Encourage MDBs to participate in NSI partnership initiatives;
- Pay special attention to South-South technology transfer.
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