World Bank hopes China will boost donation to fund for poorest countries

WASHINGTON (REUTERS) – World Bank president David Malpass said he hoped China would increase its donation to the International Development Association (IDA) fund for the poorest countries.

Mr Malpass told the Bretton Woods Committee, a United States-based supporter group, he was reaching out to China, Russia, Turkey, Britain and other donor countries as the bank seeks to raise about US$100 billion (S$135 billion) for the fund by the end of the year.

He said China’s economy had grown and he was making the case that Beijing could boost its previous, already generous donation to IDA, and Japan was also committed to a large contribution.

Mr Malpass told the group the bank was seeking an exemption from the US Securities and Exchange Commission (SEC) that would allow IDA to issue bonds on US capital markets to augment those donations.

He noted the Asian Development Bank, the Inter American Development Bank and the Asian Infrastructure Investment Bank already have such exemptions and can issue bonds on US markets.

No comment was immediately available from the SEC or the US Treasury Department.

Finance officials of the Group of 20 major economies on Wednesday said they looked forward to an ambitious replenishment of the fund.

Mr Malpass on Monday embraced the US$100 billion target previously set by African leaders, saying the funding was needed to address “tragic reversals” in development caused by the Covid-19 pandemic.

The multilateral development bank is forecasting global growth of 5.7 per cent in 2021 and 4.4 per cent in 2022, but Mr Malpass said disparities between advanced economies and developing countries were worsening and had set back efforts to reduce extreme poverty by years and, in some cases, decades.

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