Mahmoud Mohieldin, World Bank Group Senior VP
Speech at event entitled
“Insurance Industry: Sustainable Investment to Achieve the SDGs”
UN Headquarters, New York, Monday, April 23, 2018
Your Excellencies, Distinguished Guests, Ladies and Gentlemen, I am delighted to be here today on behalf of the World Bank Group along with: our Managing Director and CFO, Joaquim Levy; the Permanent Ambassador of Egypt to the UN, His Excellency Ambassador Edrees; and colleagues from the World Bank Group and around the UN system.
We are here today to support the 2018 Financing for Development Forum, including the launch of the 2018 Report of the Inter-Agency Task Force on Financing for Development, and to have this important conversation on the role of insurance industry investments in achieving the SDGs.
An increasing number of insurance companies now recognize the importance of sustainable investment strategies and are aware of the great challenges to mobilize the financing needs to fully realize the 2030 Agenda and the Sustainable Development Goals. The insurance industry is informing policyholders on potential benefits and risks, and furthering its ambition of supporting more sustainable investments. This requires adopting better sustainability standards, which can facilitate the transition to a low-carbon, resilient, and sustainable global economy.
This falls into the strategy that the World Bank Group outlined three years ago, essentially noting the need for a paradigm shift on how development should be financed to unlock the resources needed to achieve the SDGs.
As we have said in the past, we must grow development finance from the billions offered in Official Development Assistance (ODA) to the trillions available in all kinds of financing, including public and private, international, and domestic.
And this means looking to non-traditional sources of finance that can be invested in projects supporting the SDGs -- such as the insurance sector -- which can play a pivotal role in supporting resilience and sustainable development, while enabling other investments.
And I am very pleased to say here today that this past Saturday at the 2018 Spring Meetings, the World Bank Group’s shareholders endorsed a package of measures that include a $13 billion paid-in capital increase that will greatly strengthen the institution’s financial ability to support the 2030 Agenda and the SDGs, and allow for greater responsiveness to risks to global stability and security, particularly in poorer countries and fragile states.
Taken together, the package is expected to support the combined financing arms of the World Bank Group to reach an average annual capacity of nearly $100 billion between FY19 and FY30, benefiting all Bank Group members across the income spectrum.
The world needs intelligent development finance that goes well beyond filling financing gaps and that can be used strategically to unlock, leverage, and catalyze private flows and domestic resources.
We need to continue mobilizing private investments for the poorest countries. This is evidenced by the IDA Private Sector Window and the new World Bank Group Maximizing Finance for Development strategy. This approach will shape our involvement by asking a number of cascading questions so we don’t crowd out the private sector, but instead create opportunities to crowd them in.
This approach is designed to support the mobilization of private sector resources for the SDGs and the 2030 Agenda. It systematically shifts the way that we assess projects and attract private financing. Our ambitions are high: within the next three years all the multilateral development banks have agreed to increase private sector mobilization by 25 to 35 percent.
To achieve this, we are working with the world’s largest institutional investors – including the Insurance Sector – to explore meaningful and impactful ways to increase financing for the SDGs.
Today’s event will discuss whether a greater share of the insurance industry’s assets can be invested sustainably to support development. It will also explore what the World Bank Group and others are doing -- and how they can scale it up to do more in this area.
I look forward to the discussion today, thank you.