EDB Chairman Calls for Expansion of Multilateral Development Banks’ Capital Base at ADFIAP Annual Meeting
Muscat, Oman, 24 April 2025. Nikolai Podguzov, the Chairman of the Eurasian Development Bank (EDB) and Member of the ADFIAP Board of Directors, delivered a keynote address at the ADFIAP Annual Meeting 2025 in Muscat, Oman, urging a major expansion of multilateral development banks’ (MDB) capital base to meet the urgent financing needs of emerging and developing economies.
While MDBs currently provide around $200 billion annually in development financing, developing countries need at least $4 trillion per year for sustainable infrastructure – energy, water, transport, digital, etc.
Addressing the ADFIAP audience, consisting of 90+ development institutions from Asia and the Pacific, Nikolai Podguzov mentioned that this issue was also pertinent for the whole family of development finance institutions, including Public Development Banks along with MDBs. They should together fill a substantial part of the $4 trillion yearly gap in infrastructure finance.
MDBs play a unique role in development finance by:
- Leveraging public funds, turning $1 of capital into $4 of new investment.
- Financing large-scale projects — such as transport, logistics, water systems, and energy infrastructure — that are too costly or risky for individual countries or institutions to undertake alone.
The EDB Chairman supported the undergoing discussion on MDBs’ efficiency under the aegis of the G20. He stressed that, while development institutions were conservative by nature, innovative approaches toward increasing their capital base could pay off. He specifically mentioned:
- Attracting Institutional Investors – pension funds, insurance companies, and sovereign wealth funds hold trillions in assets and appreciate stable, long-term investment opportunities. MDBs can structure projects to meet their risk-return requirements.
- Issuing Perpetual Debt – unlike traditional bonds, perpetual debt has no maturity date, providing MDBs with permanent capital and reducing refinancing risks. It comes at a cost, though.
- The G20 proposal to channel special drawing rights (SDRs) into MDBs’ capital.
“The scale of global challenges demands a healthy dose of financial innovation,” said the EDB Chairman. “By expanding MDB capital through various mechanisms, we can serve our member states even better.”
The Chairman emphasized that each MDB can adopt tailored solutions based on its financial structure, but all must act swiftly to meet rising demand. The EDB remains committed to pioneering new financing models, particularly in water security and regional infrastructure.
To learn more about the topic, please read the EDB report on Capital in Multilateral Development Banks.
Additional Information:
The Eurasian Development Bank (EDB) is a multilateral development bank investing in Eurasia. For more than 18 years, the Bank has worked to strengthen and expand economic ties and foster comprehensive development in its member countries. By 2025, the EDB’s cumulative portfolio comprised 305 projects with a total investment of US $16.5 billion. The Bank's portfolio consists principally of projects with an integration effect in transport infrastructure, digital systems, green energy, agriculture, manufacturing, and mechanical engineering. The Bank’s operations are guided by the UN Sustainable Development Goals and ESG principles.
ADFIAP is the focal point of all development banks and other financial institutions engaged in the financing of development in the Asia-Pacific region. Its mission is to advance sustainable development through its members. Founded in 1976, ADFIAP has currently 90 member-institutions in 40 countries. ADFIAP is also a founding member of the World Federation of Development Financing Institutions composed of regional associations in Africa, Asia-Pacific, Latin America and the Middle East.
The EDB Chairman of the Management Board Nikolai Podguzov is on the ADFIAP Board of Directors. The Eurasian Development Bank is a Special Member of the Association.
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