Bridging the Gap: Brazil Experience
Written by Jigar Patel and Chris van der Does de Willebois
Building bridges is complicated. In reality, physical bridges can be practical; engineering masterpieces and structures of beauty. The most delicate and the most undervalued bridges, however, are the invisible ones, those which tie together generations, natural beauty, and global economics. It is impossible to leave Brazil without feeling the interconnectedness of nations across these three dimensions and of the need to reinforce our commitments to building and maintaining the bridges that facilitate these connections.
At a time when bridges are being burnt, predominantly due to the current political winds and partially due to the anachronism of old structures, we need crucial support for international trade and for builders of these invisible highways. The comforting news is that we have been here before.
Building bridges requires vision, dedication, and a collective will to create lasting bonds for the future. The World Bank and its component institutions, stand as a pillar of this transformation by unlocking opportunities, empowering communities, and providing the financial support needed to fuel growth in regions facing profound economic, climate and societal challenges.
The opponents of international institutions are becoming louder. It is politically expedient not just to trim back their overreaches, but to hack away at the foundational roots that have provided the stability and balance to facilitating periods of international peace and prosperity.
The requirements of increased agility, innovation and collaboration demands closer proximity to these institutions and their satellites, not a destructive pullback. Can this generation rethink, rebuild, and safeguard the systems that have contributed to decades of development and stability without calling into question their entire existence?
This piece is inspired by the EMBA 2024 cohort’s recent visit to the IFC Sao Paulo offices. The International Business Study Trip in totality highlighted the complexities of international trade, and the role of trade in building a better, sustainable future for all.
MDIs: OUTDATED OR UNDERAPPRECIATED?
Free-market economists often downplay the role of multilateral development institutions (MDIs), believing that industry is the overwhelming force behind innovation, growth, and development. In the context of our visit to the IFC, however, this view overlooks two critical aspects: the role that international finance from institutions plays in increasing global prosperity, and the values that guide these decisions.
Much of the world does not operate within a purely liberal, free-trade context with strong political, legal and economic stability. The number of nations who have adopted free-trade-based practices has grown significantly over the past century. Against this backdrop, the World Bank Group – and, by extension, the IFC — has worked tirelessly to build the bridges which foster interconnectedness and facilitate progress across borders whilst furthering the economic and societal principles of its shareholders.
It is short-sighted and self-defeating for shareholder countries, like the US, to tear down the ties that have been of significant benefit to them. The IFC does not just finance private sector projects; it adheres to values that align with long-term development goals, including those set by the United Nations Sustainable Development Goals (SDGs). Their approach is not a one-size-fits-all; rather, they recognise that each region, each country and each community has its own unique context that requires tailored solutions. Through decades of experience, they understand that true prosperity can only be achieved by considering local conditions, understanding political realities, and respecting cultural contexts.
NOT A TRADITIONAL GROUP OF BANKERS
The breadth of the IFC's work was nothing short of eye-opening. The IFC operates across a wide range of sectors, each playing a critical role in fostering sustainable development. Their efforts span various domains.
IFC financiers provide funding to local banks, enabling them to offer loans to businesses—particularly small and medium-sized enterprises (SMEs). This access to capital is crucial for unlocking growth in underserved regions.
The experience IFC infrastructure team supports large-scale infrastructure projects that have far-reaching economic and social impacts. These projects create jobs, stimulate local businesses, and provide essential services to communities, ultimately transforming entire regions.
Micro-Financing, through initiatives like their partnership with Natura, empowers and supports individuals in developing regions to start their own businesses and grow their livelihoods.
The IFC is also active in emerging markets by funding startups and innovative businesses through venture capital and private equity. In doing so the IFC helps to diversify economies and drive technological advancement in areas that lack the resources for such investments.
A cursory glance at the approaches and the financial products deployed by the team in Brazil demonstrates clearly that this is not a group weighed down by tradition. There is a willingness to innovate and adapt, and they are open to new ideas from willing partners.
OVERCOMING CRITIQUES
While the work of MDIs like the IFC is vital, it is not without its critiques. One common gripe is the potential for these institutions to be used as tools of soft power. The alternative to this diplomatic approach is a less favourable fragmented world where such cooperation does not exist or where the opportunistic behaviour that defined centuries of economic colonialisation is present. It is also important to recognise that the shareholders expect market returns, not subsidised or charitable rates.
Another critique is the difficulty or pace of obtaining funding from the IFC, especially in high-risk and volatile regions. The IFC often operates in areas where market conditions are unstable or untested, which naturally requires a higher tolerance for risk. Finally, some argue that the IFC’s emphasis on large-scale infrastructure projects may not always address the root causes of inequality or poverty. While these projects create jobs and stimulate economic activity, they do not always lead to long-term, sustainable development that reaches the most vulnerable of populations. Critics suggest that more attention should be given to grassroots, community-driven initiatives that focus on inclusive and sustainable growth from the ground up. Both areas of criticisms highlight the importance of balancing risk and reward, financial and reputational, in such challenging environments.
CAMBRIDGE’S HERITAGE CAN INSPIRE GLOBAL CONNECTIVITY
Earlier this year, King’s College and Queens College jointly hosted a dialogue for the Bretton Woods Institution 80th Anniversary. The setting served as a reminder of the global impact and influence exercised by historical figures during difficult times in the past, but also its continued pull for current leaders. The University continues to provide a privileged launching pad for curious minds and global thinkers. To this generation of Cambridge students, old relationships need to be supported, and new ones need to be built. It is now our time to explore, converse, and define how this can be done, ensuring that the pathways created today are strong enough to carry us into a future of shared progress, sustainability, and prosperity.
Jigar Patel
Jigar is an EMBA candidate at Judge Business School and an E-Lab Member. He holds a BA in Jurisprudence from University of Oxford (Pembroke College) and an LLM in International Commercial Law with a Specialisation in Competition Law from City Law School. Jigar has twelve years of strategy and growth experience at technology, media and e-commerce companies based in the UK and USA.
Christiaan van der Does de Willebois
Chris is an EMBA candidate at Cambridge Judge Business School. He holds degrees in Law and Philosophy from the Universities of Amsterdam and Groningen. With over a decade of leadership experience scaling high-growth companies in technology, finance, and sustainability, Chris believes in the power of entrepreneurship and innovation to drive systemic change. A former attorney and World Bank consultant, he is committed to building solutions that create a more sustainable and equitable future.