world bank: New type of public-pvt partnership needed to fund green growth, reduce dependence on banks: World Bank Country Director

World Bank Country Director Auguste Tano Kouame on Tuesday made a case for a new type of partnership between public and private sectors to fund green growth and also reduce dependence on banks for long term finances. He also appreciated India’s strategy to protect the poor during the Covid pandemic as well as boosting infrastructure investment to push growth.

Participating in a CII panel discussion on ‘Financing Growth in Emerging Markets’, Kouame said there was a need for more ‘blended finance’ and at the same time strengthening regulations to deal with non-payment and bailout, wherever needed.

“We also need investment in public goods. What is needed in the next generation of financing for growth of emerging markets is more long-term finance, and a new type of partnership between public and private sector to finance global public good. This means bringing in more blended finance,” he said.

There is a financing gap of USD 10 trillion for infrastructure investment in emerging markets, he said, adding that a “lot of creative thinking” is needed to ensure that savings get converted into long term investments.

Stating that private investment for infrastructure is very potent for growth and its more potent if it’s complimented by initial public investment, Kouame said there are areas where more can be done, including in going beyond the dominance of the banking sector in most emerging market economies, and India is not an exception.

“The banking sector is overtly dominated when it comes to financing the economy… The world needs long term investment, green investment, which are very risky,” he said.