G-20 sets up an expert panel on multilateral institution reforms

NK Singh, Larry Summers to head the expert group

The Group of Twenty (G20) under India’s Presidency has formed an expert group to formulate a detailed plan for reforms in multilateral institutions like the International Monetary Fund and World Bank.

The panel will be headed by former 15th Finance Commission chairman N K Singh and former United States Treasury Secretary Lawrence Summers.

The panel will come up with a road map for an updated multilateral ecosystem for the 21st century, with milestones and timelines, and including vision, incentive structure, operational approaches and financial capacity, said a Finance Ministry statement.

This will enable the multilateral development banks (MDBs) to be better equipped to finance a wide range of sustainable development goals and trans-boundary challenges, such as climate change and health.

The panel will also do an “evaluation of various estimates regarding the scale of funding required by and from MDBs for addressing their and member countries’ increased financing needs, alongside other important sources, such as the private sector and public sector funds”, the statement said.

The panel will also come up with mechanisms for coordination among MDBs for them to address and finance global development and other challenges more effectively.

The high-profile panel will include Singapore government minister Tharman Shanmugarathnam, Nicholas Stern from London School of Economics, mining major AngloGold Ashanti Chairperson Maria Ramos and former Brazil central bank governor Arminio Fraga, among others.

The panel will submit its report to G20 President India before June 30, and it will be taken up for deliberation at the G20 meeting of Finance Ministers and Central Bank Governors (FMCBG) in Gandhinagar in July.

Finance Minister Nirmala Sitharaman had first announced the setting up of this panel at the FMCBG in February.

“We urge MDBs to increase their efforts to discuss and propose options for implementing the recommendations within their own governance framework while safeguarding the banks’ long-term financial sustainability, robust credit ratings, and preferred creditor status,” the chair summary after that FMCBG meeting had stated.