PM Modi with Joe Biden
The White House said Tuesday that at the G20 conference in Delhi next month, US President Joe Biden will call for reforms to the International Monetary Fund (IMF) and the World Bank that will better serve the needs of developing countries.
According to White House National Security Advisor Jake Sullivan, the two must provide a better alternative for development assistance and funding to what he calls China’s coercive and unsustainable lending via Beijing’s Belt and Road Initiative.
“We have heard loud and clear that countries want us to step up our support in the face of the overlapping challenges they face”, Sullivan said.
Biden promised that while at the G20, he will really focus a lot of his energy on the modernization of the multilateral development banks, including the World Bank and the IMF.
He stated that the goal is to ensure that development banks provide high-standard, high-leverage solutions to the difficulties that developing countries face.
He described the two institutions as highly effective and transparent, in contrast to Beijing’s Belt and Road Initiative, a decade-old programme that has featured significant infrastructure and industrial loans to impoverished countries.
“I am suggesting the World Bank and IMF is a positive, affirmative alternative to what is a much more opaque, or coercive method of development finance China is offering”, he explained.
According to him, the US will promote measures in Delhi that would raise World Bank and IMF lending ability by $200 billion.
However, Sullivan emphasized that China, as a member of the G20 and a key partner in the IMF and World Bank, is critical to modernizing these institutions.
“So our support for the World Bank and the IMF is not directed against China”, he explained.
Sullivan’s remarks came as the BRICS, a China-dominated organization of key emerging countries, held their own meeting in South Africa.
Brazil, Russia, India, China, and South Africa (BRICS) account for a quarter of the global GDP, and interest in joining the club has increased.
“We are not looking at the BRICS as evolving into some kind of geopolitical rival to the United States or anyone else. This is a very diverse collection of countries”, Sullivan remarked.
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