US treasury secretary Janet Yellen on Sunday backed reforms of the multilateral (MDBs), including leveraging private sector finance to deal with global challenges such as Climate-change”>Climate Change, but suggested that the $100-billion Equity infusion proposed by the independent expert group could wait till other steps are taken a position that is going to be discussed in the coming days.
US support for equity to MDBs is seen to be critical as a $1 support, given its 16% shareholding, will result in $6 expansion in the equity base. This is estimated to result in $90 external funding.
The estimates are based on the expert groups calculations, which suggest that $1 equity at the overall level, will support $15 additional external funding around $7direct lending by the MDBs and $8 in additional direct and indirect mobilisation of external private capital.