Fri | Aug 14, 2020

Mauricio J. Claver-Carone | New IDB leadership to strengthen the Americas - Five goals for five years

Published:Sunday | July 19, 2020 | 12:15 AMMauricio J. Claver-Carone - Guest Columnist

Inter-American Development Bank headquarters at Washington, DC.
Inter-American Development Bank headquarters at Washington, DC.

On September 12, 2020, there will be an election for the next president of the Inter-American Development Bank (IDB), the most important regional development finance institution of the Americas.

This election will present a choice between a 21st-century model focused on an expedited recovery, innovation, and growth in the region – or more of the same that has produced limited results. Clearly, 2020 has proven to be a year that defies the status quo and requires a transformative vision.

My candidacy for the IDB presidency breaks with history, presents a commitment from the United States to the region, and offers a new approach that seeks to strengthen the bank’s role. The IDB should be on the frontier of development and sustainable economic growth, and as president, my tenure would represent a strategic realignment towards the Americas, improved governance, and a focus on our shared values of inclusion, prosperity, and security.

COVID-19 has spurred an economic crisis that risks pushing Latin America and the Caribbean into the largest economic contraction of its history. In fact, the International Monetary Fund (IMF) has predicted a 9.4 per cent contraction for Latin America, compared to 4.9 per cent for the rest of the global economy. This represents a steeper decline than the region previously experienced during the various 20th-century debt crises and The Great Financial Crisis of 2008. The effects will be devastating. Fortunately, the robust stimulus response of the United States, combined with the structural strength of the US economy, can contribute to a prompt recovery and growth throughout the region.

I believe in the concept of America Crece based on the notion that prosperity for one can lead to prosperity for all.

As the chief architect of the United States’ America Crece initiative, I will seek to turn this time of challenge into one of historic opportunity in order to redirect the antiquated vision of East-West financial and commercial chains and strengthen our North-South ties to increase joint investment. I will promote actions that boost access to capital, generate employment, promote fair and competitive wage growth, ensure the inclusion of women, and expand energy affordability to kick-start engines of growth in the Americas. I further recognise the importance of addressing challenges for the region beyond COVID-19 to include disaster resilience and the impact of climate change on vulnerable populations, small island-states, and critical sectors like agriculture, among others.

My 21st-century vision for the IDB is to mobilise the most innovative financial tools, incentives, and resources in a targeted and strategic manner that aligns with the region’s needs and builds ecosystems of sustainable economic growth. My leadership of the IDB will seek to expand its role as an incubator of new ideas that drive and catalyse private investment as well as invigorate traditional development tools that can accelerate economic recovery. I propose a five-point platform that will define my single five-year term (‘5-for-5’). These include:

Prioritise economic growth and development of member countries: In its founding agreement, the established purpose of the IDB is “to contribute to the acceleration of the process of economic and social development of the regional developing member countries, individually and collectively.” The IDB must return to this founding principle and measure success exclusively by the success of its Member Countries.

America Crece for the 21st century: Prosperity is a shared value, and the IDB should lead in identifying ways to work with the region to ensure prosperity for all. America Crece is a United States whole-of-government initiative to ramp up US private-sector engagement and catalyse energy and infrastructure investment in the region. The IDB should lead a whole-of-region approach, taking advantage of America Crece.

Promote good governance: The IDB should set the gold standard for governance and decision-making on inter-American matters. New leadership will focus on building bridges and strengthening relationships with the governors and executive directors. Doing so is critical to establishing standards of transparency, best practices, and strong morale among member countries. IDB management must respect the primacy of governors and executive directors, listening to each constituency, in order to set policy for the institution.

• S trengthen US commitment to the region: The Western Hemisphere is bound by a set of common principles based on shared prosperity, democratic governance, and open markets. A US president for the IDB is recognition of the importance of building stronger ties within the Americas and ensuring mutual economic success. US leadership can take the IDB further into the 21st century – to the cutting edge of development and economic growth – as an incubator for creative solutions that will utilise private sector expertise and new tools.

One-term commitment: The IDB has only had four presidents in 60 years. This has created a culture of self-interest and immobility. The office of the President should work for the people of the region, not be an entrenched interest in itself.

The IDB stands to play the most important role in its 60 years of existence. New leadership can redefine how it will chart the path toward recovery, growth, and resilience for the Americas.

To execute my vision, I commit to building an inclusive and representative senior team that will be the next generation of leadership. I believe in the value of shared success and in the transparent stewardship of the IDB. The region deserves nothing less. I stand ready to immediately start the hard work that must be done.

– Mauricio J. Claver-Carone is a candidate for president of the Inter-American Development Bank. He is deputy assistant to the president and senior director for Western Hemisphere Affairs at the US National Security Council. A former US Department of Treasury official, he served as US executive director at the International Monetary Fund.