In 2016, multilateral development banks committed to align their development finance activities with the goals of the Paris Agreement. This requires the banks to ensure that all their activities advance low-carbon, climate resilient-development pathways, or at least not undermine these goals. In this series of memos from NewClimate, Germanwatch and WRI, we provide input for a robust alignment process along the six alignment building blocks around which the MDBs have agreed to organise the implementation of their alginment work.
Multilateral Development Banks (MDBs) have a critical role to play in helping countries meet the objectives of the Paris Agreement: MDBs are major finance providers to developing countries, including for infrastructure, much of which will be around for decades and therefore have a long-term effect on countries’ development trajectories, resilience, and future carbon emissions. The banks also directly or indirectly mobilize additional finance by acting as lead investors, mobilising and crowding in investment from others.
The MDBs have jointly committed to support the Agreement through aligning their activities, along six “building blocks” that cover the following areas:
As an input to this process, NewClimate, Germanwatch, and the World Resources Institute have written a series of memos with principles and recommendations for robust alignment.