Public Development Banks: Better Understanding Their Role in Financing Transitions

For decades, economists have debated the role and necessity of public banks in development financing. In 2020, the creation of the Finance in Common System (FiCS), which brings together more than 540 PDBs worldwide, has reinvigorated these debates, placing these actors at the heart of academic thinking and international policy dialogue.

For AFD Group, PDBs are strategic partners. Strengthening financial systems is one of the Group’s top priorities: expanding access to financing, supporting the transition toward more sustainable financial models, and strengthening the resilience and stability of financial institutions. 

In 2024, AFD Group committed close to €3 billion to financial systems and PDBs account for nearly half of the financing devoted to this area. Beyond the volumes mobilized, the challenge is to strengthen the collective ability to better understand how development financing can respond to increasingly complex and interconnected challenges. 

AFD supports the production and dissemination of research aimed at analyzing the role of public development banks in the development financing architecture. 

This activity, which falls under the priority research area “Geopolitics and Development Finance,” is structured around two complementary pillars: 

Since 2020, members of the Global Research Network (GRN) have collectively published nearly 100 original research articles. To structure and consolidate this work, AFD supported the production of the Public Development Banks Reference Book (2025), with support from the United Nations Department of Economic and Social Affairs (UNDESA) and the Finance in Common (FiCS) secretariat. Published by Pearson on the occasion of the 4th International Conference on Financing for Development (FfD4), this book is a landmark contribution to the academic literature on public development banks.

The program also enabled the development of the first database dedicated internationally to public development banks, co-designed by Peking University, the Fondation pour les Études et Recherches sur le Développement International (FERDI), and AFD. This resource is now a reference tool for researchers, financial institutions, and policymakers. By offering a harmonized typology of public financial institutions and internationally comparable data, it facilitates comparative analysis, strengthens transparency, and helps better track the evolution of public development banks and development finance institutions.

Findings from the program are regularly presented at international conferences and dialogues, particularly at Finance in Common (FiCS) summits. As part of France’s G7 presidency, AFD organized the first conference international academic dedicated exclusively to public development banks in 2026.

Discover also: Public Development Banks: What Research Tells Us, and Why It Matters 

The 2026 research conference provided an overview of current knowledge and research perspectives on public development banks. Drawing on the most recent academic work, a publication prepared following the conference provides a synthesis of the main lessons from the literature and highlights the current challenges these institutions face.

It sets out recommendations for key stakeholders, in particular finance ministers (in their capacity as shareholders and supervisors of PDBs), PDB leaders, and regulatory authorities. These recommendations aim to strengthen the role of public development banks as catalysts for long-term investment in support of national priorities and the delivery of global public goods.