Multistakeholder Partnerships for Development and the Financialization of Development Assistance

Abstract

Multistakeholder partnerships (MSPs) for development are being revitalized in the post-2015 era as essential vehicles in financing and realizing sustainable development. This article argues that MSPs for development play a central role as new financial actors in shaping the legal and ideational structures of development assistance, pushing for a financialized development assistance model that relies on the steady multiplication of new financial markets and instruments. The article tracks the trajectory of MSPs and their transition over time into key actors in the financialization of development assistance. After summarizing the key axes of this financialization, the article describes how MSPs have become new financial actors by offering to play a four-in-one role (gap-filling, catalysing, brokering and optimizing) in development financing. To do so, they use private legal mechanisms to create and roll-out so-called ‘innovative’ financial instruments and mechanisms such as up-front incentives and subsidies, frontloading mechanisms, results-based instruments and debt swaps. The resulting financialized development assistance model has amplified the power and influence of MSPs and their private donors over development governance and led to accountability shortcomings by downplaying the possible socio-economic impacts of new proposed instruments and by creating risks of increased development assistance policy fragmentation.