Youth Think Tank Salon｜Humanitarian Action and Development Finance: Advancing Sustainable Public Goods Provision in Protracted Crises

Murtaza Syed, Head of Ecosystem in the Economics Department at the Asian Infrastructure Investment Bank in Beijing, responded from the perspective of multilateral development banks. He stated that institutions like the AIIB do face constraints in fragile and conflict-affected settings: shareholders' demands for capital security and stable ratings influence overall risk appetite; infrastructure projects must meet fundamental requirements for on-site assessment and macro-level sustainability; and conventional lending instruments often fail to achieve risk-return parity in high-risk environments. However, this does not imply helplessness and impossibility. The key lies in refining the “project shape and structure” to reach an accessible threshold: First, incorporate a “buffer zone” in the capital structure, such as allocating approximately 15–20% as first-loss or subordinated funding, covered by grants or quasi-grants. This absorbs potential early-stage losses, thereby protecting intermediate and senior funding tranches. Second, incorporate credit enhancement mechanisms like political risk guarantees, such as collaborating with the Multilateral Investment Guarantee Agency (MIGA) to cover risk points of expropriation, transfer restrictions, and contract breaches. Third, solidify and refine the “early stage evidence chain”— instead of a general risk assessment, establish clear entry windows (timing and post-entry actions), credible local partners with defined roles, and locally tailored engineering, operations, and maintenance plans. Goma's ability to “scale up” stemmed from this tangible evidence and pathway. Syed added that the AIIB's swift establishment and normalization of emergency support mechanisms during the pandemic demonstrate that it is entirely possible for policy tools to accelerate iteration when major shareholders reach consensus. He looks forward to collaborating with the ICRC, the SDC, and relevant Chinese authorities and enterprises to explore more joint pathways for essential services like water supply, sanitation, and energy, with the approach of following the sequence of “from small to big, from stability to swiftness”.

During the subsequent discussion and interaction, the panelists focused on “how to transform high-risk regions into bankable scenarios.” Participants agreed that approaches and methodologies must first be aligned, followed by demonstration projects to translate “investable and financeable” concepts from paper to the ground. Official aid providers can “systematically assume reasonable risks” through: Selecting appropriate windows of opportunity, conducting small-amount periodic validation, strengthening monitoring and technical support, and engaging as early as possible with multilateral institutions to create a “relay scaling” effect. Enterprises should also participate earlier — Goma secured periodic seed funding from commercial banks, restored water and electricity through corporate collaboration during the time when the city was affected by conflict, and explored technical partnerships with equipment suppliers. As conditions improve, market-based mechanisms will become the critical fulcrum for systemic sustainability.

In his closing remarks, Staehelin emphasized that the consensus from this dialogue is crystal clear: we must break departmental silos to enable humanitarian and development efforts to operate in tandem on the same ground; and we must treat essential services like water supply, sanitation, and healthcare as the public's “first line of defense,” thereby reducing long-term costs at their source. Using Beijing as a platform, policymakers and think tanks can connect rules, processes, and tools across the “shareholder—bilateral--multilateral--humanitarian--corporate” spectrum. China, together with the ICRC, the AIIB, and partners in China, is fully capable of packaging methods tested in places like the DRC into replicable “operational blueprints” that can be implemented effectively in more fragile regions.