Yellen to push development bank progression at Spring Meetings

US Treasury Secretary, Janet Yellen, will be hosting a roundtable discussion on Wednesday, to evolve the World Bank and other development lenders in context of climate change and global crises, said the Treasury.

“The discussion that will be taking place in the World Bank and International Monetary Fund’s Spring Meetings will gather finance ministers from major shareholders and borrowing countries that will cover ways to maintain momentum to evolve the multilateral development banks to better meet current challenges,” said the Treasury in a statement.

Bank shareholders are predicting the World Bank to propose balance sheet changes to allow it to lend an additional $50 billion over 10 years while maintaining its top tier AAA credit rating.

“The reforms amounted to a once in a generation transition of the institutions and called the World Bank’s plans a downpayment on the reforms that would be deepened in time and spread to other multilateral development banks,” said The US Treasury Undersecretary, Jay Shambaugh.

It’s essential to fix the banks’ operational structure and incentives and ensure effective use of funds, some development banks had considerable room on their balance sheets, Shambaugh added.

Yellen will be discussing changes to harness more private capital and create public-private partnerships to tackle climate change and current global crises like the pandemic and economic uncertainty, a senior Treasury official said.

Yellen is hoping to present another plan to make progress on the banks’ operational models and financial capacity.