There is a new consensus in international development circles. As Lord Stern put it: ‘the challenge of achieving the SDGs is in large measure that challenge, of fostering the right kind of sustainable infrastructure’, for which, ‘you have to have good finance, the right kind of finance, at the right scale, at the right time’. The ambition, spelled out in the World Bank’s new Maximising Finance for Development, the Billions to Trillions or the G20 Infrastructure as an Asset Class agenda, is to create investable opportunities in poor countries that can attract the trillions of global institutional investors. The Wall Street Consensus provides a template for how to render development interventions ‘bankable’.

Viewed through a critical macro-finance lens, the Wall Street Consensus is the rightful heir of the (post) Washington Consensus. It seeks to re-organize poor countries’ financial systems towards securities, repo and derivative markets, or market-based finance. This policy-engineered financial globalisation leaves countries more vulnerable to global financial cycles, to volatile capital flows and to (shadow) bank elites. It narrows developmental policy space, by seeking a clean break from developmental models reliant on ‘policy-engineered industrialisation’ that involved developmental banking guided by the priorities of industrial strategies and a closely controlled relationship with global finance (via capital controls and competitive exchange rate management). It also promotes the privatisation of public services in order to generate cash-flows that can be directed to the owners of securities.