On September 14th, the seventh session of the Certified Economic Diplomat Program at the Institute of Economics and Finance in Ghana featured a trio of eminent speakers who provided deep insights into the functions and impact of global development agencies. Ute Reisinger, Senior Environmental and Social Development Specialist at the International Finance Corporation (IFC), Ricardo Gomez Puternicki, Senior Counsel at the OPEC Fund for International Development, and Florian Peter Iwinjak, External Relations Officer at the United Nations Industrial Development Organization (UNIDO), each shared their perspectives on how their respective organizations contribute to international development.

Ute Reisinger opened the session with a comprehensive overview of Development Finance Institutions (DFIs) and their role in financing sustainable development, with a particular emphasis on Africa. She traced the origins of DFIs to the Bretton Woods institutions—the International Monetary Fund (IMF) and the World Bank—established after World War II to provide financial stability for reconstruction and development. Reisinger detailed that the IMF focuses on short-term fiscal support, while the World Bank takes a long-term approach, funding projects that aim to reduce poverty and address climate change.

Reisinger elaborated that DFIs extend beyond these foundational institutions. Regional development banks, such as the African, Inter-American, and Asian Development Banks, as well as newer entities like the BRICS New Development Bank and China’s Asian Infrastructure Investment Bank, have emerged as key players in development finance. She also highlighted the role of national development banks and specialized institutions like the Green Climate Fund.

One of the key points Reisinger made was the unique advantages of DFIs, including their capacity to offer concessional loans—loans with favourable terms—particularly to countries recovering from conflict or natural disasters. These loans, however, often come with stringent conditions related to social and environmental safeguards. While these safeguards are essential for ensuring that development projects do not adversely affect local communities, they can pose challenges for recipient countries. Reisinger acknowledged criticisms faced by the IMF and World Bank for imposing austerity measures and Western values, but she emphasized that these safeguards are crucial for sustainable development.

Reisinger also touched on the governance structures of these institutions, noting that decisions are significantly influenced by member states, particularly those with the most shares. She highlighted that shifts in global political and economic power, such as China's growing influence, are prompting DFIs to continually demonstrate their value in development.

Concluding her presentation, Reisinger stressed that DFIs provide more than just financial support. They act as "knowledge banks," offering technical expertise and capacity-building opportunities that help emerging economies, particularly in Africa, develop long-term, context-specific solutions.

Ricardo Jose Gomez Puternicki followed with a detailed lecture on "Financing Development Through Business Diplomacy: The Case of the OPEC Fund for International Development (OPEC Fund) since 1976." Gomez Puternicki clarified the distinction between the Organization of the Petroleum Exporting Countries (OPEC) and the OPEC Fund. While both originated from the same group of OPEC member countries, the OPEC Fund was established to support development, in low and middle income countries, except for OPEC member countries, and upstream oil and gas businesses. Originally, it supported countries with their balance of payments, and later with their sovereign and non-sovereign operations, as well as technical assistance programs.

The speaker highlighted the OPEC Fund’s mission rooted in South-South Cooperation, where wealthier southern countries support the development of other southern nations. Since its inception, the OPEC Fund has committed approximately $27 billion to over 4,000 projects in 125 countries. The total value of these projects is around $200 billion, underscoring the Fund's significant impact.

The OPEC Fund focuses on financing sustainable development, aligning with the United Nations' Sustainable Development Goals (SDGs). It finances a range of projects, with the aim of increasing economic resilience, support growth and foster development. Unlike some development finance institutions, the OPEC Fund does not provide technical assistance directly but partners with organizations like the World Bank and other regional development banks for co-financing.

Addressing common myths about OPEC’s political influence, Gomez Puternicki emphasized that the OPEC Fund operates with a strict apolitical focus. Its governing board is dedicated to evaluating projects based solely on their developmental impact and financial viability. Recent initiatives, such as the Food Security Action Plan and the Climate Action Plan, aim to tackle pressing issues like food security and climate change. By 2030, the OPEC Fund plans to allocate 40% of its total operations to climate financing.

Ricardo Jose Gomez Puternicki also highlighted the OPEC Fund's success in raising $1.5 billion through its first bond issuance, and SDG bond, reflecting strong investor confidence in development finance. The OPEC Fund is currently rated as AA+, Outlook Stable by Fitch and also by S&P. He concluded by noting the OPEC Fund's strategic efforts to expand its presence in Africa through partnerships and the signature of bilateral investment treaties (framework agreements for the promotion and protection of investments), with Tanzania and Ethiopia. To date, the OPEC Fund has signed 80 of these treaties out of which 79 have become into force, which in international law and commercial diplomatic terms is a great achievement.

The session wrapped up with Florian Peter Iwinjak’s lecture on the pivotal role of industrial development in achieving the SDGs, particularly in Africa. At the beginning, Iwinjak described how global the multiple crises of climate change, conflicts and the COVID-19 pandemic led to increased poverty, hunger, inflation, and value chain disruptions that are impeding progress toward the SDGs. He pointed out that only 15% of SDGs are on track. Looking at SDG 7, 8 and 9, he emphasized notable gaps in areas such as innovation, energy, and employment, and that African countries face even greater challenges.

Iwinjak underscored the importance of SDG 9, which focuses on Industry, Innovation, and Infrastructure. He linked industrialization with improved human well-being, noting that industrial development contributes to poverty reduction, better health, gender equality, and overall life expectancy. He referred to UNIDO’s Industrial development Report 2022 showing that countries with robust industrial sectors are more resilient to external shocks, such as pandemics, due to their stable supply chains and production capacities.

One part of Iwinjak’s lecture was dedicated to the resurgence of industrial policies, particularly in high-income countries. He argued that African countries need to engage more actively with industrial policies to stimulate growth, innovation, digitalization, clean energy, and job creation. Iwinjak highlighted that manufacturing has driven two-thirds of economic growth periods in the past 50 years.

Thereafter Iwinjak provided an overview of UNIDO’s work, including its technical assistance, policy advisory services, and capacity-building efforts across 120 countries. He emphasized UNIDO’s focus on sustainable industrialization in Africa through initiatives like agro-industrial parks in Ethiopia and Senegal, regional sustainable energy centres, skills development partnerships, and support for green and responsible mining.

In conclusion, Iwinjak urged to transform current global challenges into opportunities, particularly through the clean energy transition and industrial decarbonisation, economic integration and diversification, as well as the Fourth Industrial Revolution (4IR), to enhance Africa's competitiveness.

The session, concepted and organised by prof. Anis H. Bajrektarevic, on behalf of the European partners to the IEF’s CED program – offered a rich and detailed exploration of how global development agencies are driving sustainable growth and addressing complex challenges, particularly in emerging markets and developing regions. Each speaker provided a unique perspective on their organization’s contributions to international development, underscoring the importance of their roles in shaping a more sustainable future.

Kamila Bogdanova is an International Relations specialist at Masaryk University in Brno, Czechia. As the research assistant, she served at the Vienna-based Institute for the Danube Region and Central Europe (IDM). Since August 2024, she serves as the IFIMES Information Officer.