CGD in the News

5 Things To Watch At The 2017 World Bank Annual Meetings (Devex)

October 10, 2017
Share

From the article:

WASHINGTON — “Capital” looks to be the watchword of the 2017 World Bank and International Monetary Fund annual meetings: Who has it? Who’s going to get more of it? And how can it be better deployed to achieve maximum development impact around the world?

These are the first annual meetings of World Bank President Jim Yong Kim’s second term in office, and they provide a venue for Kim to make the case for why the multilateral development institution still occupies a central place in a changing world — and why it should get more funding. That pitch, difficult at the best of times, has proven a hard sell to a U.S. president and administration wary of investing in multilateral cooperation...

“We are moving in a direction and the vast majority of countries now, we think, are onboard, and it's just a question of when the capital increase will actually happen,” Kim told reporters in a press call last week. “Now it's just a question of timing. And so we hope that there will be a discussion during these annual meetings, and that there will be a deadline as to when the final decision would be made.”

Kim has run into a skeptical U.S. Treasury Department, said Scott Morris, senior fellow at the Center for Global Development and a former deputy assistant secretary at Treasury. Some U.S. officials object to the World Bank’s lending to large economies such as China, Morris said, and they believe that instead of getting more capital, the bank should do less lending to America’s economic competitors. Kim’s task will likely be to strike a bargain that relates to the bank’s large country borrowers in exchange for a shareholder agreement to hand over more money, Morris said.

“They’re not going to get a firm ‘yes’ — or even a soft ‘yes’ — from the United States at this stage. They’re hoping to avoid anything that looks like a firm ‘no,’” Morris said.

He added that Kim’s aim will be to extract some kind of statement from the U.S. representatives to the bank that creates a timeline for deciding about the capital increase in time for the 2018 spring meetings in April.

One prominent World Bank staff member told Devex that the question of the capital increase is the one thing on bank employees’ minds during these annual meetings, because a ‘yes’ or ‘no’ from the bank’s shareholders “will determine whether we're in expansion mode or hunkering down.”

Read full article here.