What will the Ukraine conflict mean for multilateral finance?

Abstract

Suspending Russia and Belarus as members of the World Bank and European Bank for Reconstruction and Development would be misguided for developmental, political and legal reasons.

The Ukraine crisis will tighten lending headroom of EBRD and the World Bank, accentuating the call to strengthen MDB capital, but it poses no danger to the long-term financial stability of either bank.

New Development Bank will face severe impacts from the crisis due to its exposure to Russia as a shareholder and borrower, while Asian Infrastructure Investment Bank will be much less impacted.

The Black Sea Trade and Development Bank and the Russia-led International Investment Bank will also face considerable difficulties due to the conflict.