Interview with Enrique I. Florencio, Secretary General of ADFIAP.
1. How important were the actions taken by development banks during the crisis generated by the Covid-19 pandemic?
The role of development finance institutions has expanded in the past decade, as more have been created and they have been allocated greater amounts of capital. But amid the COVID-19 pandemic, they face the test of whether their plans will work and whether they can live up to the greater responsibility they have been given.
Most DFIs appear to approach their COVID-19 response strategies through a phased approach, concentrating first on immediate needs and then looking at their role in the recovery process.
2. What are the priority lines of action, themes, or sectors for the development banks in your region?
ADFIAP’s purpose is to advance sustainable development which was adopted by the ADFIAP General Assembly in 2004 or 11 years before the SDGs have been formally announced by the U.N. So, when the SDGs came about, ADFIAP’S advocacies have been focused on contributing to the achievement of SDGs through its members’ work on sustainable/green finance, financial inclusion, blended finance, infrastructure finance, and MSME finance, climate finance, transition finance, and Net Zero initiatives.
3. How strongly does climate change impact your region and what are development banks doing to adapt to and mitigate it?
Fighting climate change is all about reducing greenhouse gases (GHG). It has become a challenge for the past decades. The global response to this challenge entails a massive shift in industrial and financial resources.
Everyone including civil society needs to transform their thinking to doing business that is more sustainable and less dependent on fossil fuels
Some of our member banks have started to establish specialized climate finance facilities and designated business units to handle climate financing. They had been able to access support in funding with partial risk or credit guarantee, interest rate subsidies, and longer loan term facilities.
Others took narrower steps by having first a distinct and articulated climate change strategy then proceeded with creating a short list of opportunity areas prioritizing projects from existing portfolios.
4. What do you consider that development banks in your region should focus on more strongly to improve job creation and, in general, the people’s well-being?
The pandemic and prolonged uncertainties have increased unemployment, poverty, and inequality. While COVID-19 seems to be behind us now, DFIs faced with the domino effect of the pandemic on the economy of their respective nations, such as poverty, health issues, and unemployment, making businesses, as usual, a New Normal. Therefore, DFIs’ role as development bankers is very relevant when finding solutions through new financing schemes to overcome those issues.
5. In perspective, how do you view the importance of the development banks in your region? Is there a genuine interest in strengthening them and giving them a key role to play in the countries’ development?
National development finance institutions (DFIs), as instruments of public good created by governments, have a special mandate to contribute to the country’s sustainable development programs.
They are also best prepared and positioned to provide leadership, financial, and technical assistance to strategic, priority, and underserved sectors of the economy. More than ever, with rapid changes in demographics, markets, technology, regulatory regimes, and pandemic impact, DFIs are at the forefront of these challenges and opportunities.
6. In this new post-Covid-19 international scenario, how do you see the relationship between development banks and a global initiative such as Finance in Common?
DFIs played a meaningful role in helping the private sector scale up manufacturing capacity and ease supply chain disruptions for COVID-19 response, as well as sustain service provision to meet other health needs.
Finance in Common Initiative is a welcoming opportunity for all DFIs since its mission is to strengthen partnerships among Public Development Banks to accelerate the convergence towards shared standards and best practices, to support banks’ commitments to shift their strategies towards sustainability and to give PDBs more visibility in the global fora discussing international policy issues.
7. Do you consider that international organizations and global summits like the United Nations Climate Change Conference of the Parties (COP) are giving development banks the position they are entitled to and taking advantage of their potential? What would you propose?
With more funds being rolled out and country regulations being implemented to accelerate Sustainable Development, DFIs’ pivotal role becomes more heightened. DFIs’ active involvement with COP activities and initiatives would be more meaningful if there will be shared responsibility in all its advocacy and programs both at the national and regional levels.
8. Just how committed are the development banks in your region to the sustainable development goals (SDGs)?
ADFIAP remains a key mover in advancing sustainable development in the region by strengthening the development of finance functions and institutions, enhancing the capacity of its members, and advocating innovations in development finance.
As an organization that champions sustainable development through financing, ADFIAP serves as a platform for its members to share innovative solutions addressing economic, social, environmental, and governance challenges.
9. How are digitalization tools and financial technology being incorporated in development banks to enhance your region’s financial inclusion, and in general to improve their efficiency and coverage?
Developing countries in Asia and the Pacific are exploring ways to expand access to affordable financial services to the financially excluded through digital technology. Further, digital technology is rapidly becoming the biggest driver around the world of economic innovation, competition, and growth. Even though many people have been excluded from the digital economy, tremendous opportunities are available for it to support financial inclusion for sustainable economic Development
For ADFIAP, Technology Development is one of its advocacies, and as part of DFI’s strategy, many of its members have embedded/integrated cutting-edge technology in their core bank operations transforming their financial services landscape and reach.
10. What do you suggest be done to strengthen and enhance the institutional presence of the World Federation of Development Financing Institutions at the global level?
The role of WFDFI is much bigger as it comprises five regional associations that’s why Its impact is limitless.
To strengthen and enhance WFDFI’s institutional presence, the WFDFI CEO Forum must be revived. The forum is an annual platform for chief executive officers of development banks to meet with and learn from each other.
The main objective of the conference is to present a global perspective on the role, activities, and practices of DFIs as well as trends in development banking around the world.
Warning: Array to string conversion in /home/wfdfi23/public_html/wp-content/themes/experts/includes/library/functions.php on line 304