Southern Solutions to Fill Gaps in Global Development and Climate Finance: How the World’s Most Vulnerable Countries Are Deepening a Fourth Wave of Public Banking

This article addresses the question of what financial resources are available to the world’s most climate exposed and vulnerable countries, and how this fits within and contributes to the broader South-South financial landscape. It presents original empirical data and institutional analysis to show new trends where emerging Southern-led public banks and financial institutions are deepening and broadening the global financial architecture, and why they feel compelled to do it. Using data from the IMF, UNCTAD, and the FICS/Peking University Institute of New Structural Economics Public Banks Database the article argues that the most climate-exposed and vulnerable countries have the least available finance and pay the highest prices for it. These countries did not cause the climate crisis, they are among the most impacted by it, and they have the least resources to confront it. Nonetheless, this does not mean they can do nothing; this article aims to show how developing countries are taking the reins into their own hands in an effort to fill gaps and limitations of the global financial architecture. It maps the public development banks owned by the 74 members of the Vulnerable-20 grouping, alongside complementary, innovative, instruments and mechanisms being created by V-20 and a broader, overlapping, group of net borrower countries. The article identifies and nests these within a maturing “fourth wave” of South-South initiatives that began in the mid 2010’s with the largest BRICS economies. The incipient Borrowers Platform, launched in 2026 by net borrowing countries, could, if successful, represent the peak thus far in this evolution.