Civil Society Meeting with New Development Bank (NDB), Shanghai, October 2017

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Purpose

Civil society representatives, including members of SSI and BRICS Feminist Watch (BFW) met the senior management and other staff members of the NDB on 25th-26th October, 2017 at the Bank Headquarters in Shanghai.

Process

The senior management of the bank including the Vice President and Chief Administrative Officer, Vladimir Kazbekov, Vice President and Chief Operations Officer, Xian Zhu, and Vice President and Chief Financial Officer Leslie Maasdorp shared information and responded to queries on the structure, staffing approach, administrative structure, communications, project financing, policy and implementation, approved projects, financial instruments including green bonds, and the bank’s credit rating.

The CSOs in turn presented their concerns, suggestions, and demands on issues of transparency, accountability, access to information, gender, environmental and social management, the bank strategy, and ways forward for a civil society interaction mechanism.

Main Messages

  • The bank reiterated its commitment to sustainability and being green. But it would seem that it hasn’t yet defined sustainability and the understanding seems to be that green energy is universally good- concerns around land grabbing for wind energy parks for instance do not seem to have been considered. Also, the bank is not excluding traditional sectors, but it will consider these projects on a case by case basis, and include them if it is convinced by a clean technology component and value add in NDB’s portfolio.
  • The bank could expand to sectors such as sanitation and urbanization. With traditional infrastructure, the approach seems to be of ‘do no harm’, but with sustainable infrastructure, the approach would be to generate or maximise positive impacts.
  • The bank is committed to being a lean, efficient, and fast organization. The staffing remains sparse, with many young professionals. The bank also claims to have achieved 40 per cent women staffing but admitted that hiring women at higher posts has not been adequate.
  • The African Regional Centre was launched in 2017 and the Brazil Regional Centre is expected to be launched by the end of 2018.
  • Currently the bank is lending sovereign loans to national development banks and financial intermediaries but it is expected that by 2020, the bank would be lending a mix of sovereign and non-sovereign loans, and use financial intermediaries to lend to the private sector.
  • The bank is keen to lend in local currency not only to bypass the dominance of US dollar but also to pass on benefits to borrowers.
  • The NDB’s priority is to get an international credit rating but it does not want to be restrictive in project selection and bankability based on this; an AA or AA- rating should be enough for stability according to them.
  • The bank views itself as an important instrument of South-South Cooperation and remains demand driven and respectful of country systems. It is also committed to achieving global goals on SDGs and climate. But in the approach to achieving them, the bank is wary of aping other multilateral development banks.
  • The bank has also said that it would disclose project summaries over the coming months but it was repeatedly challenged on the fact that 11 projects have already been approved without any public information about them.
  • The bank claims to be using country systems for project assessment as it considers them to be robust enough but the parameters have not been shared. But the bank staff shared that adopting country systems is not completely unconditional and if there are gaps, then bank would take that up with the governments.
  • Moreover, the bank claims that community consultations have been carried out by the governments, but has not specified whether this was done by national or local governments and no further documents or information has been shared.

 

Key Demands

Civil society representative put forth the following demands-

On Transparency

  • Clarification on how can civil society effectively give feedbacks on the information disclosure policy is implemented
  • A framework for the next review of the disclosure policy and a consultation process established by the bank to improve the policy and the way the bank provides information.
  • Bank should immediately publish project documents at all stages of the project cycle on its website.

On Gender

  • The bank should have a gender strategy or policy to guide all of NDB’s structure, governance, and operations. The policy should be mandatory with a ‘do‐no‐harm’ safeguard.
  • It is essential to ensure gender responsive policies become a culture within NBD operations. It could start by hiring a senior gender expert to start this process.
  • Set up a multi‐stakeholder gender advisory committee to advice and effectively work with the bank to integrate gender concerns across the NDB.

On Environment and Social Management

  • Work together with civil society in the short term to have a full fledge methodology on sustainable infrastructure criteria.

Interaction with Civil Society

  • Importance of engagement and consultation with local and diverse community representatives.
  • Civil society groups should be engaged to contribute to strategy, policy, implementation and monitoring.
  • The bank along with civil society must develop collective mechanisms for effective and meaningful engagement.

 

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