Excellencies, Members of the Board of Governors of the New Development Bank,
Members of the Board of Directors of the New Development Bank,
Vice-Presidents and all members of NDB,
Distinguished Guests, Ladies and Gentlemen,
The global economy has been facing instability. Rising geopolitical conflicts, increasing unilateral measures, trade wars, financial volatility, and technological restrictions are putting enormous pressure on every country. At the same time, the climate crisis continues to intensify, and an energy crisis is in sight.
We are meeting today at a time when the international system is undergoing an even more impactful event with the invasion-war in the Middle East.
These effects extend far beyond the immediate dynamics of conflict. It is true that there is a regional impact, affecting all the Middle East countries, but it is also true that there are huge international geopolitical and geoeconomics implications. The disruption of oil and gas supply chains, weak traditional links in the global economy, and heighten vulnerability critical value chains — from petrochemicals and fertilizers, to advanced electronics and semiconductors. Disruptions in these sectors have far-reaching implications as they ripple through production systems, trade and finance flows and price stability, triggering inflation spikes, stagnation in growth and raising the risk of deeper economic contraction. High fertilizer prices intensify food insecurity. The war-invasion in Middle-East shakes the implicit exchange between pricing the oil in dollar against security guarantees.
These effects, however, are not evenly distributed. Developing countries are often the most exposed — given their dependence on imported commodities, and greater sensitivity to external shocks. But not only them. Higher energy and commodity prices and the prospect of shortages in oil and gas supply in advanced non-producer countries, expose them to a scenario of increased uncertainties, amplifying economic volatility and eroding household purchasing power.
In this context, readiness is essential. Strengthening resilience and securing alternative and reliable sources of funds have become a priority. Over the past few years the New Development Bank has consolidated its balance sheet, reestablished its presence in capital markets and resumed programmatic expansion. However, the new geopolitical and geoeconomic configuration demands more. We must act decisively and adapt our instruments, operational modalities and partnership frameworks to respond to the challenges ahead.
Among the risks already confronting global markets, particular attention must be paid to the disruptive capacity of unilateral sanctions, which have exacerbated shortages in already‑strained oil, gas and fertilizer markets amid Middle East blockages. Such measures not only interrupt trade and critical supply chains to sanctioned countries, they also create market restrictions with significant costs even to the sanction imposing countries. This is what has been happening in Europe.
Another challenge refers to the need to address the acute liquidity shortfall arising from the required reconstruction costs following large‑scale infrastructure destruction in the Middle East. Higher prices of oil, gas and fertilizers create more deficits at same time that the governments try to protect its population from inflation. This new shock of liquidity raises the cost to refinancing the enormous debt of advanced economies and also reducing the liquidity to the rest of the world. In conclusion, increasing debt levels will raise funding costs, drawing global liquidity toward advanced issuers and crowding out EMDCs.
Other important challenge refers to the successive financial markets transformations. The first one is securitization of assets which turn illiquid assets into liquid tradable ones. This now is a well know commonly used financial instrument. The second stablishes digitalization and suppress paper and produces extremely connected digital markets. The third leads to tokenization which is turning the digitalized assets into programmable ones, a network‑native instruments. These three stages of evolution permit more liquidity, provide faster settlement and create new funding channels. In this process, geopolitical clearance systems and concentrated custodian networks are avoided. So, become clear that tokenization has geopolitical significance since it reduces dependence on traditional financial instruments. Moreover, tokenized financial infrastructure may eventually become part of broader geopolitical competition over reserve currency systems, payment networks, and global liquidity architecture. Today, this movement is part of a new reality at an early stage of deployment
Experience over the past years has helped us to better identify where further progress can be made. The Bank has demonstrated its capacity to mobilize resources, diversify its funding instruments, and maintain strong financial fundamentals.
Faced with these rapid and complex challenges, NDB must adapt its funding strategy by actively exploring both traditional instruments and emerging digital alternatives to lower its cost of capital and improve its access to funding. Amid heightened global uncertainty, the Bank must also remain prepared to operate under adverse scenarios: strengthening financial resilience, preserving flexibility, and maintaining robust liquidity buffers to ensure continuity of operations across a wide range of external conditions. In addition to proven market debt instruments, such as trade-finance, guarantees, issuances in local currencies and swaps and co-financing, the Bank should examine tokenization to broaden funding channels and hedge currency risks.
The Bank has to prioritize the pursuing of diversified opportunities in local currencies, help to deepen local capital markets and reduce reliance on traditional global financial centers. By combining these approaches with carefully governed innovations, the Bank can reduce funding costs, diversify sources, and strengthen its ability to finance member priorities at scale.
Strategic focus will also be decisive. The Bank cannot expand in all directions simultaneously. It must concentrate its efforts on where it can deliver the greatest impact to development. All kinds of infrastructure, logistics, digital, social remains the foundation of development and the capacity building in technologies and innovation, investments in industrial and technological parks, with support of governments, private sector and academia , are now central drivers of productivity and structural transformation.
The energy transition is also central. It requires diversification, reliability, and scale. Renewable and clean energy have to continue its expansion. Small modular nuclear reactors associated with the substitution of coal and fossil fuel fired power plants for example, may contribute to ensuring stable and low-carbon energy supply.
In light of this, the discussions taking place alongside this Annual Meeting acquire particular significance. The seminars organized in parallel reflect the strategic direction that development finance must take. They address issues such as the role of nuclear power in ensuring energy security, the challenge of financing innovation and new industrialization, the transformation of universities and human capital in the new economy, the implications of artificial intelligence on financial systems, the emergence of digital tokenized asset markets, and the future of healthcare systems in a context of demographic and technological change. These themes point to a common reality: development today is inseparable from technological transformation and from the capacity of states and institutions to guide that transformation in public interest. They also make clear that the challenge before us is to ensure that technological progress does not deepen inequalities, but instead becomes a driver of inclusion, productivity, and sovereignty. In this sense, these discussions are not peripheral to our work. They are at its core.
As NDB embarks in the formulation of its new Strategy, the vision is clear: the Bank will be larger, greener, more digital, more innovative, more agile, and more cooperative — while remaining grounded in pragmatism and focused on delivery.
Local currency financing will remain a strategic priority and particular attention will also be given to expanding operational engagement with the Bank’s newest members, including the objective of advancing operations across all recently admitted borrowing countries.
The Bank will be strengthening its role as a platform for cooperation among its members — supporting initiatives in digital infrastructure, energy transition and advanced low-carbon energy technologies, intelligent hospitals and all sort of innovation, amplifying the comparative advantages of our member countries. Social infrastructure — including health, education, housing, and urban systems — will play an increasing role in ensuring inclusion and resilience.
NDB will continue to pursue gradual, balanced membership expansion and strengthen its role as a unified voice and platform for the Global South, amplifying members’ priorities, facilitating South–South cooperation, and mobilizing collective solutions to shared development challenges.
I reiterate, the expansion of the Bank’s financial toolkit — including guarantees, trade finance, and risk-sharing mechanisms in addition to co-finance, local-currencies— will be central to mobilizing additional capital and enhancing development impact.
The Bank will strengthen project preparation and implementation support, particularly for non-sovereign operations and capacity-building activities.
New instruments and pilot operations will continue to be developed to diversify the Bank’s financing toolkit and respond to evolving client demands.
The Bank is also advancing the digital transformation of its operations and institutional processes.
Excellencies,
The New Development Bank has built a solid foundation. It has demonstrated resilience and established its credibility. We are now entering a new phase — one that will be defined not by ambition alone, but by the capacity to deliver transformation.
This is the role that the New Development Bank must play in its second golden decade. Thank you.