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Role of Development Bank Associations in the Twenty-First
Century Introduction
It was in January 1968 when the Inter-American Development Bank (IDB)
released one of its staff members to establish the first regional
association of development banks, the Latin American Association of
Development Financing Institutions (ALIDE), in Lima, Peru, in
collaboration with the Industrial Bank of Peru, which provided office
space and support staff to get ALIDE's operations started. Ricardo
Palma Valderrama from Peru became the first Secretary General of ALIDE
and Rubens Vaz da Costa from Brazil, a former president of the Bank of
the Northeast of Brazil, became its first President. In 1968, the
Inter-American Development Bank considered this creation of an
association of development banks in its borrowing member countries an
item of the highest priority, because it felt that such an association
could critically contribute to raising the quality, competency, and
capabilities of these institutions, which were receiving large lines
of credit ("global loans") from the IDB for the financing of
small and medium sized projects in their countries. This increase in
quality of projects would raise the effectiveness of the global loans
of the Inter-American Development Bank (IDB).
The decade of the 1960s was also the time when economic and social
cost/benefit analysis became a standard practice for the appraisal of
projects by development banks, as well as for calculating the expected
internal rates of return of projects. The IDB considered it important
to create a capability in cost/benefit analysis in each development
bank and the new development bank association was to provide training
in this field for its members.
Profile of Regional Assocciations
National Development Bank Associations
For many years there have existed national development bank
associations, mostly in a number of large countries. In Brazil,
the Association of Brazilien Development Banks (ABDE) has played an
influential and important role. It publishes the highly respected
journal "Rumos" every month. In Malaysia, the
Association of Development Finance Institutions of Malaysia (ADFIM)
has played an important role in training. In Nigeria, the
Association of Nigerian Development Finance Institutions (ANDFI) plays
a coordinating role among this country's development banks. In
Indonesia the Indonesian Association of Regional Development Banks (IARDB)
has provided an important link for the development banks in the
numerous large islands. In thePacific, the Association of
Development Finance Institutions in the Pacific (ADFIP) links
development banks in the various island states of the South Pacific
region. The website for ABDE is: www.abde.org.br
Need for Autonomy and Sustainability
The early sponsors of the associations were in agreement that they
would reduce their support of the associations as more and more
support was received from their members and they reached the point
where their membership fees would become sufficient to support their
operations. There was the need for institution building and capacity
building in terms of publications, training, research, studies and
advisory services. The membership grew in the 1970's and the funding
reached a point where it was expected to fully support the need for
institution and capacity building. Steps were taken to cut the
umbilical cord to the main sponsors, but it was hard to relinquish
this dependence and support. While the associations had operational
autonomy, they only became fully independent when their offices moved
out of their original offices in the buildings of their sponsors. This
happened first with ALIDE when it constructed its own headquarters
building in 1979. ADFIMI relocated from Jeddah to Istanbul in 1987. It
then was the case for ADFIAP when it occupied new quarters in 1989.
AADFI moved out of the ADB building to a building in 1993.
The external debt crisis of 1982 had a strong negative effect on the
finances of the member institutions of the associations. Membership
dues remained outstanding and it became difficult to maintain
previously achieved operational levels.
Members also sent fewer of their staff to training activities, which
increased the costs per participant. Particularly in the case of
AADFI, a large number of members failed to pay dues and AADFI became
again more dependent on the support from the African Development Bank,
UNDP, EDI and other sponsors. Even ALIDE and ADFIAP, the larger
associations in terms of staff, had to restructure and downsize their
operations. In the process they had to trim their publications,
training and research activities. This paralleled restructuring and
diversification trends in their member institutions.
With the external debt crisis of 1982, the justification for
development banks was called into question. They have substantially
changed during the intervening eighteen years, from 1982 to 2000. They
have reaffirmed their importance as agents of development financing
and shown, particularly during the Asian financial crisis, that they
can be relied upon to provide sounder development financing than their
competitors in the banking sector. In this new world of finance, with
an new financial architecture emerging, the services to be provided by
the associations have also changed.
Need for a Strong and Clear Image
An important study of the first fifty years of development banking (Kapur/Lewis/Webb)
concludes that the aspect in which development banks have least
fulfilled their functions was to build their profile with the public
and to make the importance of their role generally known and
understood. That profile had been defined by their governments for
them when there was still development planning and every developing
country had a five-year plan. Development banks have now stepped out
from under their governments' umbrellas and they had to create and
project their image themselves to the public and stand in the open
during good weather and bad.
Today this open environment requires an effective use of the media and
of the internet. Publications, videos, compact disks and websites are
needed to project the image, mission and functions of development
banks. The regional development bank associations can fill the new
needs and where they need to collaborate under the umbrella of the
World Federation of Development Financing Institutions (WFDFI) to
achieve this objective. To have a strong voice at the regional level,
but also to have a clear voice at the international level, is becoming
vital for surviving in the Twenty-First Century. This is the different
role they have to assume for assuring the success of private and
public development banks in the financing of development in the future.
Delivery of Services
This does not preclude the delivery of service that the development
bank associations have been offering to members in the past. The
members of the associations continue much in need of the range of
services and assistance that the associations can provide. This
assistance includes training, publications, research, studies,
regional meetings, workshops, financial intermediation and advisory
services. There is a consensus that the majority of development banks
should diversify their operations adjusting them to the new business
opportunities and necessities to strengthen their competitive position
and to generate profits with the support of the training and technical
advise coming from their associations and the World Federation.
Development banks also need to act more as catalysts to coordinate
member activities to achieve larger scale, greater scope and better
quality. Networking and the building of partnership relations becomes
a requirement in the Twenty-First Century.
In this new world, relationships have also changed. The requirements
are now for global-, regional- and sub-regional partnerships that
contribute a degree of synergy and create wider public participation
and participation at the grass roots level. This implies that
association membership cannot be limited any more to those who can
afford and are willing to pay annual membership fees. The constituency
and membership needs to include all development banks. Those who can
least afford to pay need the services most. This means that the
associations need to finance their operations out of fees and charges
for their services. Fees would not only be charged to their members,
but also to all non-members making use of these services. Associations
will need to operate in response to public and market needs. Like
private businesses, or consulting firms, they need to assure
themselves that revenues will cover their operating costs and yield
additional funds for expanding and improving future services.
Annex
List of Presidents and Secretaries General of Development Bank
Associations from 1968 to 2004
Presidents of ALIDE
Rubens Vaz da Costa, Brazil, 1968-1969
Ignacio Copete-Lizarralde, Colombia, 1969-1973
Eduardo Gómez Tamayo, Venezuela, 1973-1974
Ernesto Rohrmoser García, Costa Rica, 1974-1977
Karlos Rischbieter, Brazil, 1977-1978
Tomás A. Pastoriza, Dominican Republic, 1978-1980
Igidio Ianella, Argentina, 1980-1981
Adolfo Nass, Venezuela, 1981-1983
Camillo Calazans de Magelhaes, Brazil, 1983-1986
Gustavo Petricioli, Mexico, 1986-1987
José Salaverry Llosa, Peru, 1987-1988
Ricardo Avellaneda, Argentina,1988-1989
Frederich E. Bergés, Dominican Republic, 1989-1990
Jesús Villamizar Angulo, Colombia, 1990-1992
Oscar Espinoza Villareal, Mexico, 1992-1994
Hindenburgo C. Pereira-Dinitz, Brazil, 1994-1995
Rodolfo Anibal Frigeri, Argentina, 1995-1996
Marcos R. Pessoa Duarte, Brazil, 1996-97
Noel Lezama Martínez, Venezuela, 1997-1999
César Rodríguez Battle, Uruguay, 1999
Carlos
Sales Gutiérrez, México, 2000
Gonzalo
Rivas Gómez, Chile, 2001-2003
William Hayden Quintero, Costa Rica, 2003
Mario Laborín, México, 2004-2006
Nicolla Angelucci, 2006
Chairmen of AADFI
August Daubrey, Ivory Coast, 1975-1976
René Amichia, Ivory Coast, 1977-1985
John Bentum-Williams, Ghana, 1985-1988
Alhaji Abubakar Abdulkadir, Nigeria, 1989
Mohammed Aissaoui, Marocco, 1989-1991
Alhaji S. Y. Kasimu, Nigeria, 1995-1997
Gershom M. B. Mumba, Zambia, 1998-2003
Remis
Omotoso, Nigeria, 2003
Chairmen of ADFIAP
H. F. G. Lembruggen, Malaysia, 1976
Vicente R. Jayme, Philippines, 1976-1986
John Fletcher, Australia, 1986-1989
Suresh S. Nadkarni, India, 1989-1992
Chang-Dal Kim, Korea, 1992-1995
Aswin Kongsiri, Thailand, 1996-1998
Saleh Ghazali, Malaysia, 1998
Isoa
Kaloumaira, 2003
Anothai Techamontrikul, Thailand, 2003-2004
Jesus P. Tambunting, Philippines, 2004
Chairmen of ADFIMI
Rajab Salim As-Saad, Jordan, 1986-1993
Tahir Abbas, Pakistan, 1993-1994
Hayati Ozkan, Turkey, 1995-1998
Safa Ocak, Turkey, 1999
Sudi Apak, Turkey, 1999-2000
Orhan Güleç, Turkey, 2000- 2001
Md. Noor Yusoff, Malaysia, 2001-2004
Muhammad Rashid Zahir, 2004-2006
Mehmet Emin Ozcan, 2006
Chairmen of EDFI
Loet Mennes, Netherlands, 1992-1994
Sven Riskaer, Denmark, 1995
Joaquín de la Infiesta, Spain, 1996
Rainer von Othegraven, Germany, 1997
Philippe Wilmès, Belgium, 1998
Antoine Pouillieute, France, 1999
Olle Arefalk, 2003
R. Michael Barth, 2003
- 2004
Winfried Polte, 2005
Secretaries General of Development Bank Associations
ALIDE
Ricardo Palma Valderrama, Perú, 1968-1978
José Andrés Bellido, Perú, 1978-1979
Carlos Garatea Yori, Perú 1979-1999
Rommel Acevedo, Perú, 1999
AADFI
George Aithnard, Togo, 1975-1980
Pierre William, Senegal, 1981-1983
Sedozan J. C. Apithy, Cameroon, 1984-1987
G. Henry Andrews, Liberria, 1987-1988
Pierre William, Senegal, 1988-1989
Mohammed Ould Cheikh-Sidia, Mauritania, 1990-1993
John A. Hammonds, Ghana, 1993-1996
Magatte Wade, Senegal, 1997-2003
Joseph
Alfred Amihere, 2003
ADFIAP
Orlando P. Peña, Philippines, 1976 - 2004
Octavio B. Peralta, 2005
ADFIMI
Abdelaziz Kuntoadji, Indonesia, 1986
Aydemir Koc, Turkey, 1987-1996
Orhan Sagci, Turkey, 1997-2006
Nuri Birtek, 2006
EDFI ("Representatives")
Hans Meier Ewert, Germany, 1992-1996
Frans Baneke, Netherlands, 1997-1998
Sean Magee, United Kingdom, 1999 - 2004
Jan Rixen, 2004
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