���������ֳ�

���������ֳ� expects the operating environment for supranationals to be neutral in 2024. This is in line with our 2024 Outlook published in December 2023. We expect the macro environment to be broadly stable with global economic growth moderately weaker than last year. While lower inflation will enable some monetary policy loosening and support access to financing for the emerging markets in which supranationals operate, continued high geopolitical risks, including possible spillovers from the wars in Ukraine and in the Middle East, weigh on prospects. Several multilateral development banks (MDBs) are exposed to distressed sovereign borrowers and rely on their preferred creditor status (PCS) to maintain loan performance. The momentum around MDBs’ capital adequacy framework reform is accelerating. In January 2024, the African Development Bank (AAA/Stable) issued a USD750 million hybrid instrument, the first time any MDB has issued hybrids on capital markets. ���������ֳ� expects other MDBs to follow suit. We also anticipate that MDBs will accelerate capital management reforms, including schemes to transfer credit risks (e.g. guarantees and securitisation). Meanwhile, ���������ֳ� has published a Discussion Paper on its ratings criteria. The criteria review should enable us to capture MDB’s evolving business model in our ratings criteria.