US wants to see quick progress on World Bank reforms: Janet Yellen

The United States Secretary of the Treasury, Janet Yellensaid his country would like to see faster progress on the plans of the world Bank to expand its lending capacity to address climate change and other global crises.

The World Bank’s “road map of evolution” calls for for the bank to negotiate with shareholders ahead of April meetings on proposals including a capital increase and new lending tools.

Asks World Bank management to develop specific proposals for changing its mission, operating model, and financial capacity that could be endorsed by the joint World Bank-World Bank Development Committee International Monetary Fund in October.

The plan marks the beginning of a negotiation process to alter the bank’s mission and financial resources away from a country- and project-specific lending model used since its creation at the end of World War II.

Yellen said the bank’s roadmap was a “constructive document” and formed a good basis for discussion, but more work was needed.

“We have some concerns,” he told Reuters as he traveled to Zambia from Senegal. “We would like see some progress on a faster schedule. And I think there are some things that could be done to expand lending given the current capital release.”

Yellen said that working on reforms, first at the World Bank and then at other multilateral development banks, was one of her top priorities this year.

The United States, the bank’s largest shareholder, worked with other countries to pressure the World Bank to develop the reform plan, which was discussed by the bank’s board on January 11.

“2023 is the year to make specific short-term gains with the Spring Meetings (in April)… and lay the groundwork for more fundamental/complex reforms by the October meetings,” said a senior Treasury official.

The United States and others favor a phased approach to implementation, with proposals for certain reforms released in time for the spring meetings of the IMF and World Bank to allow for some “quick wins,” the official said.