Debt vs Development: Who is Readjusting International Financial System for Climate Action?

The fourth World Summit on Finance in Common-FiCS was held in early September 2023  in Cartagena, Colombia. Bankers, finance ministers, directors of economic conglomerates with special emphasis on infrastructure, directors of “green” mechanisms, deans of finance and economics faculties, some philanthropic institutions, national and international NGOs, civil society organizations, delegations of indigenous and Afro-descendant peoples were there. FiCS is a multi-stakeholder initiative launched in France in 2020 by Public Development Banks claiming to join forces to “transform the financial system towards climate and sustainability.” FiCS aims to align the entire financial system with the Sustainable Development Goals (SDGs) and the Paris Agreement on climate climate change.

More than 520 public development banks of all types (multinational, regional, national and sub-national) and from all regions are involved in the process. This alignment is important because they are state-owned institutions, with an independent legal status and financial autonomy. The resources of these institutions are, in fact, public and should serve public mandates and interests. 

The FiCS coalition manages 23 trillion dollars in assets and about 2.5 trillion dollars in annual investments, more than 10% of the total global investment flow.  This puts them at the heart of climate financing and determines what kind of climate solutions can receive public money, even if these climate solutions are not clear to the public that finances them. And with this kind of leveraging of private capital, they expect to redirect actions expressed in their motto: “building new alliances for the next generation of development financing.” The secretariat claims to do this, among others, by financing micro and small enterprises, especially those led by women, creating new mechanisms for “closing” financial gaps around climate change adaptation and mitigation, financing sustainable infrastructure, and expanding the institutional capacity and governance of a finance development ecosystem.”

Readjusting financial system or same old tactics

I had some doubts about what I would do at the summit with a thirteen-month-old baby, especially knowing that these spaces do not often consider the requirements for caregivers to participate. I decided to participate anyway and be part of the group of 25 civil society activists from 20 countries who came together to denounce how these institutions are worsening the problems they claim to solve.

Leith Mullings, a Jamaican-born author, anthropologist and professor (may she rest in power) constantly reminded us that racial projects constantly reproduce themselves. I joined others to identify and size up the roles and strategies of the various actors that are reorganizing the financial system around the 2030 agenda, projecting it in Latin America and the global south until 2050. As an African diaspora, we need to pay attention and take a closer look at those financial changes that revolve around gender identity and climate changes and exchange ideas and experiences among ourselves. 

Public funding vs private 

FiCS set up a working group on Climate and Biodiversity to define further and mainstream sustainable development investment principles, insisting on Nature-based solutions (NBS) as the favourite instrument for channelling green investments. The secretariat presenting a Blue Finance Roadmap also highlighted the Global Green Bond Initiative (GGBI) led by the European Commission and the Swiss-based Sustainable Infrastructure Foundation (SIF) or the multilateral platform SOURCE as institutions that are advancing frameworks with Latin America and African countries. These platforms and ventures are leading the operation of green bonds, such as public infrastructure financing, “to support the resilience of cities.”  

The FiCS gender coalition presented as a preview a first mapping of gender finance based on an interview with nine volunteer BPD members of the International Development Finance Club (IDFC) and reported that they committed close to €10 billion for Gender Focused/Gender Transformative and Gender Responsive/Gender Sensitive projects. This aligning public financing to free up private financing in the name of meeting SDGs without mechanisms to transparently communicate locally the traceability and impact of that funding on meeting them is something to watch.

The Finance in Common Summit is a platform that seeks legitimacy to speak as experts on behalf of civil society with the purpose of seeking profitability.  This is interrupted by the existing disarticulation in the local rules with which public development banks operate. But the ultimate goal will be serving the climate, gender, sports, progress, welfare and development narratives as part of that capture of the next United Nations conferences, which will work on financing issues and their connection with climate change.

The participation of deans of economics and finance, managers of think tanks and private business initiatives to raise green finance allowed for updating the narrative ecosystem. There’s continued exclusion of citizens from a more open discussion on the procedures that comply with the local SDG targets and avoidance of reflection on whether these targets will be fulfilled, mainly how this translates into collective well-being and transformation of conditions that continue to reproduce inequality.

Community alternatives thrown to periphery

Community alternatives that respond to climate change and ensure justice were absent from the summit. Green businesses are generally seen as small and medium-sized enterprises that must be linked to global value chains that can control their activity. This exposes local and community interventions to instrumentalization as outside actors could benefit or harm local autonomy and governance. This also makes local businesses serve as a buffer to the shocks and externalities of climate change financing while the more international corporate funds that finance them remain intact.


A group of protesters. Photo via Shutterstock

Readjusting financial systems can’t be devoid of human rights

At the last summit held in Abidjan, Côte d’Ivoire, in 2022, civil society organisations emphasised the importance of human rights. In the Colombia summit, again, as civil society, we pushed for agreement around human rights violations arising from the financing of projects in extractive sectors, projects that often require large infrastructure investments.  It is well known that often, these large-scale investments lack safeguards, and the independent consultation and research mechanisms are insufficient even as they claim the narrative of contributing to the fulfilment of sustainable development goals.

These industries rarely mitigate climate change. Instead, they are indebting entire generations, promoting carbon markets, wind farms, green hydrogen production, and constructing mega power plants that have spearheaded a destructive use of land, forcibly removing populations and entire communities. ,   

Debasing of local knowledge systems

Local knowledge regarding the preservation of ecosystems is being lost to these mega projects. False “new” solutions are annihilating these systems of knowledge.  The only communities and populations that are superficially included to support their “official” narrative to expand market niches around an energy transition model that perpetuates and expands the impacts of the extractive sector.

Given the inevitability of the continuation of this summit, the promise remains to establish a joint action plan with delegations of civil society organisations for future meetings. We hope that as delegates of indigenous peoples and civil society, we will engage directly with all these actors and avoid working in silos as the same people talk to the same people.

Transnational Afro-diaspora organising crucial

Afro-diaspora people have been organising, and we need to increase our efforts to challenge and replace the financial mechanisms that put the neocolonial foot on our necks. As Barbados Prime Minister Mia Mottley has said, “The World Bank and International Monetary Fund no longer work for the realities of 21st-century countries.”vPM Mottley has put her finger on the sore spot, pointing out that it is the current architecture of the international financial system that prevents prosperity from being collective. 

We need a commitment that could well be based on recommendations by African feminists to start by re-imagining African political economies, which is also a call for the diaspora for the sixth region.

Tendayi Achiume, the Special Rapporteur on contemporary forms of racism, racial discrimination, xenophobia and related intolerance, has woven the connections between racial and environmental justice and climate crisis and the implications of the global extractive model and racial equality. 

Way forward on the FiCS process

As Black feminists with liberation as our goal, we need to strengthen our knowledge on these mechanisms and offer resistance tools that upset colonial orders. We can recover, conceive, and build our goals towards liberation through national care systems, foreign policy measures with a feminist approach, fighting for fiscal and tax justice, global policies on comprehensive security etc. We need to inform the efforts that are redesigning the international financial system and regulatory frameworks for the operation of development aid financing, philanthropy, and venture capital should be restricted to local conditions that are publicly debated and profusely.

The need to unmask the alignment of financing around profitability is critical, as well as its legacies and contemporary impacts, which have their roots in the transatlantic commodification and trade of people into conditions of enslavement. There is nothing new in the ways financialization and global capital systems operate in their commodification, displacement, dispossession and violence. These histories and experiences must be centered in the frontline debates and local struggles that we are a part of as we organise ourselves to live in our fullness and dignity. 

I am convinced of what the ancestral, community and collective authorities have been sustaining, that it is the territory, our lands, that are primary guarantors of our rights. It is still urgent to care for, protect and defend the land and all the life that lives on it. It requires us to be alert to the updates of false solutions which promote social mobility that make ten people visible while 10,000 still suffer the violence of hunger. 

The generation of debt in itself is a violation of human rights. Yet, the adjustment of the international financial architecture has as one of its purposes a development that guarantees them. It may be time to review, from our own diverse knowledge systems, the scope of concepts such as poverty, wealth, debt, development and human rights. Alice Mogwe, director of the International Federation for Human Rights, in a personal talk at the summit’s close, said that for her, ” Ubuntú ” offers a broader perspective when talking about development and human rights.

Yannia Sofía is Black woman born in Colombia, a researcher and a mother of two. Yannia is interested in knitting Afrodiasporic community and has been part of the Afro-Colombian social movement for more than a decade and has a degree in Economics and Creative Writing.

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