Senior Financial Sector Specialist at the World Bank, Pietro Calice has said that to create a more trustworthy and stable economic environment countries need to enhance financial integrity.
Writing on the subject “From chaos to stability: The power of financial reforms in fragile states”, Calice said authorities must be willing to strengthen the capacities of agencies involved in anti-money laundering and countering the financing of terrorism is vital.
According to him, fragile states often grapple with rampant financial crime, from money laundering to corruption adding that the issues can criminalize the economy and hinder progress toward stability.
The financial sector specialist insisted that restoring payment systems can often act as the lifeline of any economy, enabling the smooth flow of transactions, humanitarian aid, development assistance, and remittances.
He said,” In fragile contexts, building or restoring these systems presents unique challenges. Policymakers need to conduct tailored diagnostics, set clear objectives, and avoid simply copying models from more stable markets.”
The World Bank chief further said that empowering small Micro, small, and medium enterprises (MSMEs) who are the backbone of any economy will drive social stability and resilience.
He however noted that most MSMEs often face significant barriers to accessing finance.
“Policymakers should focus on developing basic financial and digital infrastructure, addressing capacity constraints, and unlocking bank financing. Leveraging nonbank financial intermediaries and carefully considering the need for concessional financing are also crucial strategies. Technical assistance programs can further enhance governance, risk management, and product development for both lenders and MSMEs,” he added.