Remarks by Secretary of the Treasury Janet L. Yellen at Press Conference at Summit for a New Global Financing Pact
Remarks by Secretary of the Treasury Janet L. Yellen at Press Conference at Summit for a New Global Financing Pact

As Prepared for Delivery

Let me begin by thanking President Macron and the French delegation for hosting this Summit.  

This Summit is an important milestone in our effort to evolve the global financial architecture to be more responsive to the challenges and opportunities facing us.  

The last two days have made me optimistic about the progress made so far – and the momentum that will carry us forward in the coming months.

I’d like to touch on our progress in three areas that I have focused on during my time at the Summit.

First, our initiative to evolve the multilateral development banks, or MDBs.  Global challenges like climate, pandemics, and fragility and conflict are putting development gains at risk.  

That’s why I called for the evolution of the development banks last fall to tackle these global challenges with sufficient speed and scale.  

Our goal is to strengthen the MDBs’ work on eradicating poverty and supporting sustainable growth – not distract from them. 

We have made significant progress on the MDB evolution initiative with a broad coalition of shareholders.

Our coalition has made preliminary updates to the World Bank’s mission and operating model.

And we are unlocking as much as $50 billion in additional lending capacity over the next decade.  Our estimate is that the MDBs – as a system – could unlock $200 billion in new lending capacity over the same timeframe through balance sheet measures that are either already under implementation or being deliberated.

That by itself is a significant achievement.  We could have $200 billion in lending capacity that we didn’t have before to invest in some of the most pressing problems facing the world – combatting climate change, lifting people out of poverty, preparing for future pandemics, and much more.  

The evolution, though, is not just about the balance sheet.  It is making sure we use these resources in a more impactful manner.

We are pushing for additional reforms on a rolling basis.  This includes work to optimize our climate finance architecture.

Second, debt and macroeconomic stability.  The IMF plays an important role in providing policy advice and technical assistance along with critical financing.

We have had constructive discussions about ensuring that the IMF can continue to provide concessional lending now and in the longer-term. 

We call on the IMF to present all available options to put its Poverty Reduction and Growth Facility on sustainable footing in the near-term by the Annual Meetings. 

And we also call for a broad range of donors to meet the IMF’s financing targets for the Trust. 

We also need to complete outstanding debt cases.  Debt is a global challenge that requires urgent cooperation from all creditors.  

To that end, I’m pleased that all official bilateral creditors have reached consensus to move forward with a debt treatment for Zambia, under the leadership of the Chinese and French co-chairs.  I just saw Premier Li at the high-level panel and am encouraged that China is moving to help address the debt challenges facing developing countries.

Beyond resolving outstanding cases, a productive first step to provide greater certainty and timeliness to the debt process would be the publication of a guide to the Common Framework for borrowers.

Third, private capital mobilization.  

As we announced earlier this morning, the Investor Leadership Network, which includes companies with a total of over $10 trillion in assets under management, has launched a new commitment to accelerate pension fund and institutional investments in emerging and developing economies over the next three years.

The United States will work closely with them to facilitate investments in the critical areas of energy transition and sustainable infrastructure. 

I also continue to believe that MDBs should launch a set of more innovation tools to boost private capital mobilization, which is a priority shared by many leaders of these institutions – like President Banga.

We have already taken significant complementary action.  Through the G7, we seek to mobilize $600 billion for high quality infrastructure investment through public and private funds over five years.  The United States has already achieved $30 billion of its $200 billion commitment.

And through initiatives like Just Energy Transition Partnerships, we’re bringing public and private sources of funding together to provide tens of billions of dollars to fight climate change and spur economic development in emerging economies.

The challenge to the world that has brought us here to Paris is make sure the global financial architecture can orient the necessary finance towards the essential tasks of eradicating poverty, combatting climate change, and building a global economy that allows people and the planet to thrive. 

There’s much more to do.  I look forward to working with the leaders on stage – and many more – to advance our shared effort.

Thank you.

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