2023-09-27 08:05:12
Sept 27 (Archyde.com) – World Bank President Ajay Banga said on Tuesday that new contributions proposed by rich countries, combined with changes to the institution’s balance sheet, could increase the bank’s lending capacity by 100 to 125 billion dollars (94.65 to 118.32 billion euros) over a decade.
These contributions will be made outside the usual framework of the bank’s shareholding and the regular contributions of countries to the International Development Association fund, intended for the poorest countries, specified Ajay Banga during an event organized by the Council on Foreign Relations.
These funds would include $2.25 billion in additional funding proposed by US President Joe Biden, as well as additional contributions expected from Germany, Japan, South Korea, Saudi Arabia and the Nordic countries.
Lending capacity would also increase thanks to the measures being implemented to make the bank’s balance sheet more efficient, including the increase in the debt ratio decided in April, which would make it possible to obtain $50 billion in new loans on 10 years, a World Bank spokesperson said separately.
The Bank is also considering expanding its resources, in particular by offering more loan guarantees, by granting loans against repayable capital pledged but not paid, and by issuing special bonds which can serve as hybrid capital. .
Ajay Banga said he expected World Bank shareholders at the annual meeting to be held in Marrakech, Morocco in October to formally adopt a review of the World Bank’s mission, which expands its role in the fight for the climate, against pandemics or food insecurity, against an objective of reducing poverty currently.
The president of the institution clarified that he had not yet had discussions with the United States and China regarding a general increase in capital and a modification of the shareholder structure of the bank.
China, India and Brazil obtained larger stakes in the bank in a capital increase in 2018 and would likely want to have more say in a future capital increase, Ajay Banga added. (Reporting by David Lawder, with contributions from Paul Grant, French version Corentin Chappron, editing by Kate Entringer)
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