Multilateral development banks (MDBs) have played a crucial role in supporting economic development and fighting poverty since the World Bank was created 70 years ago. Despite significant gains they face wide criticism for being inflexible, bureaucratic and dominated by the political interests of high-income non-borrowing shareholder countries. It is high time to review and reform our major MDBs – to reflect the realities and needs of the current global economy.
Yet the world has seen the birth of a new wave of development banks — the Asian Infrastructure Investment Bank (AIIB) and the BRICS New Development Bank (NDB) – which mark a global shift towards growing global economies, notably China. Meanwhile smaller regional MDBs are rapidly expanding their operations.
This new phenomenon throws into question the future of multilateral development banks. How will all MDBs – old and new – grapple with the interests and changing power relations of shareholding countries. Do we need to reform what’s in place, or is it time to reinvent multilateral development finance?

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