The CADTM condemns the nomination of Ajay Banga as the future President of the World Bank and calls for the replacement of this institution

1 March 2023 by CADTM International


Ajay Banga, at the India Economic Summit 2017 in New Delhi, World Economic Forum / Benedikt von Loebell, CC, Flickr, https://www.flickr.com/photos/worldeconomicforum/37480394852

A few days after the resignation of David Malpass, who remains President of the World Bank until 30 June 2023, Joe Biden announced the appointment of his successor, Ajay Banga. Like his predecessors, the future head of the World Bank is an American from the world of high finance. The CADTM International network denounces this appointment and calls for the intensification of social movements to abolish the World Bank and the IMF.



On February 23, 2023, the White House issued a statement: “Today, President Biden announced that the United States is nominating Ajay Banga, a business leader with extensive experience leading successful organizations in developing countries and forging public-private partnerships to address financial inclusion and climate change, to be President of the World Bank World Bank
WB
The World Bank was founded as part of the new international monetary system set up at Bretton Woods in 1944. Its capital is provided by member states’ contributions and loans on the international money markets. It financed public and private projects in Third World and East European countries.

It consists of several closely associated institutions, among which :

1. The International Bank for Reconstruction and Development (IBRD, 189 members in 2017), which provides loans in productive sectors such as farming or energy ;

2. The International Development Association (IDA, 159 members in 1997), which provides less advanced countries with long-term loans (35-40 years) at very low interest (1%) ;

3. The International Finance Corporation (IFC), which provides both loan and equity finance for business ventures in developing countries.

As Third World Debt gets worse, the World Bank (along with the IMF) tends to adopt a macro-economic perspective. For instance, it enforces adjustment policies that are intended to balance heavily indebted countries’ payments. The World Bank advises those countries that have to undergo the IMF’s therapy on such matters as how to reduce budget deficits, round up savings, enduce foreign investors to settle within their borders, or free prices and exchange rates.

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Once again, the President of the World Bank is American, he is a man, and he comes from high finance, which seems to be a guarantee of success for Joe Biden: “Ajay is uniquely equipped to lead the World Bank at this critical moment in history. He has spent more than three decades building and managing successful, global companies that create jobs and bring investment to developing economies, and guiding organizations through periods of fundamental change.”

Read : The resignation of David Malpass, President of the Wolrd Bank, must boost actions and mobilizations towards the replacement / the demise of both the WB and the IMF in a context of acute climate and environmental crisis

The CADTM International network condemns this nomination because:

The CADTM International network had no illusions: any decision taken by the IBRD (International Bank for Reconstruction and Development) must receive 85% of the votes to be adopted. However, the United States has 15.47% of the voting rights for each of the important decisions, so it has a de facto veto right. So there will be no positive change within the World Bank. As long as it continues to exist, it will remain an institution serving the interests of the United States, whether or not it is chaired by a US citizen drawn from big business and finance. It will continue to provide loans, usually onerous, in exchange for conditionalities that reinforce and deregulate capitalism, increase social and gender inequalities and worsen the climate and ecological crisis.

Read : The World Bank: an ABC

The CADTM International network calls once again:


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