DEVELOPMENT COMMITTEE (Joint Ministerial Committee of the Boards of Governors of the Bank and the Fund on the Transfer of Real Resources to Developing Countries) NINETY-FOURTH MEETING WASHINGTON, D.C. – OCTOBER 8, 2016 DC/S/2016-0062 October 8, 2016 Statement by H.E. Lilianne Ploumen Minister for Foreign Trade and Development Cooperation Kingdom of the Netherlands Representing the Constituency of Armenia, Bosnia and Herzegovina, Bulgaria, Croatia, Cyprus, Georgia, Israel, Macedonia, Moldova, Montenegro, The Netherlands, Romania and Ukraine Statement by H.E. Lilianne Ploumen Minister for Foreign Trade and Development Cooperation Kingdom of the Netherlands Representing the constituency of Armenia, Bosnia and Herzegovina, Bulgaria, Croatia, Cyprus, Georgia, Israel, Macedonia, Moldova, Montenegro, The Netherlands, Romania and Ukraine 94th Meeting of the Development Committee October 8, 2016 Washington, D.C. Today’s Development Committee meeting marks an important opportunity to position the World Bank Group (WBG) in the development landscape for the years ahead. As we have turned our attention to implementing the 2030 Sustainable Development Agenda, the Paris Agreement on Climate Change and the Addis Ababa Action Agenda on Financing for Development, our constituency underscores the important role the WBG has to play in making the next 15 years a success for development. We view the WBG as a crucial partner in delivering development solutions and continue to value its convening power, its public-private liaising function and its knowledge and expertise. While we welcome the WBG’s continued support for the countries in the Europe and Central Asia (ECA) region of our constituency, we urge the WBG to deepen its engagement in the ECA region to help overcome enduring low growth rates. We especially encourage the IFC to increase its efforts to bring in the private sector, driving economic growth. Forward Look Our constituency welcomes the Forward Look exercise as a strategic discussion to ensure that the WBG remains fit for purpose as it faces the demanding tasks on the horizon. Sustainable development requires the WBG to be at its best; the WBG’s value-for-money proposition requires continuous improvements to its operational efficiency and effectiveness. We welcome President Kim’s leadership in reforming the WBG and count on him to further improve the WBG’s business model by pursuing simplification, agility and decentralization, while safeguarding organizational stability. We would like to see the Forward Look developed into a work program with results indicators and specific targets for that, to be discussed at the Spring Meetings in 2017. Our constituency calls on the WBG to further expand its leadership on the Finance for Development Agenda, as traditional development finance will never be sufficient to make the Global Goals a reality. We share the WBG’s recognition of the critical role of the private sector and the need for domestic resource mobilisation as well as public expenditure management. However, we urge the WBG to go the extra mile to translate ambitions into tangible results and to set periodic targets for that in its country- based approach. ‘From Billions to Trillions’ should be more than a catchphrase. While the WBG is the world’s largest development organization, achieving the Global Goals requires a clear division of labour with other development partner institutions. Our constituency underlines that the WBG should focus on its core comparative advantages – such as mobilizing resources and knowledge for development. We also encourage the WBG to fulfil its mission as One World Bank Group. While we support the WBG’s enhanced focus on countries affected by fragility and conflict, the WBG should seek to complement the work of other humanitarian and development players, especially when it comes to issues of forced displacement. The newly developed Global Crisis Response Platform is a good step in this direction. Dynamic Formula Our constituency takes note of the fact that a great majority of shareholders have reached a compromise on the dynamic formula, which will serve as a basis for regular shareholding reviews, reflecting the evolution of the global economy and countries’ contributions to the WBG’s development mission. However, while the aim of the dynamic formula is to ensure a more equitable balance of voting power, the proposed formula does not produce outcomes that are fair to all, taking into account the different roles and responsibilities of WBG’s shareholders. Furthermore, the formula is not friendly enough to IDA to entice new donors to contribute to it, nor does it adequately recognise established donor contributions. Therefore, we expect the membership to take measures in the next stage of the discussion to rebalance shareholding in manageable steps, for example by setting limits on excessive dilution. The governance of IDA needs to be reviewed to preserve its legitimacy and financial viability. IDA’s business model will continue to depend on major donor contributions as we move towards leveraging its capital base. The present distinction between Part I and Part II countries, which is also reflected in the distinction at the IBRD between advanced economies on the one hand and developing and transition countries on the other, does not sufficiently reflect the current global economic reality and thus lacks credibility. Forced Displacement With an estimated 65 million refugees worldwide, refugee crises are putting additional strain on developing countries, eroding hard-earned development gains. Our constituency has urged the WBG to focus on addressing the root causes of forced displacement and to improve the economic integration of refugees, particularly women and girls, in host communities. We appreciate the WBG’s work thus far, especially the much-needed support provided to Jordan and Lebanon through the Concessional Financing Facility (CFF). We also welcome the proposed window in IDA18 to provide support for refugees and host communities. Safeguards Our constituency has been actively engaged in the WBG’s efforts to strengthen and streamline its safeguard policies. We view the new Environmental and Social Framework as a welcome improvement, and value the progress that has been made on human rights, indigenous peoples and the inclusion of Free, Prior and Informed Consent, labour standards and non-discrimination. As the world’s largest development institution, the WBG has a responsibility to continue to play a leading role in safeguard policymaking. Additionally, we will closely monitor the implementation of the safeguards and encourage the WBG to turn its attention to building countries’ capacity to take ownership of the new framework. Ultimately, this should lead to greater efficiency and better outcomes for development. 2