Oct 13-15, 2017: Belt-tightening in view for Fall World Bank-IMF meeting
UNITED STATES - Global finance leaders can expect difficult choices when they gather at the United Nations for the Fall meeting of the International Monetary Fund (IMF) and World Bank (WB): the United States, the largest shareholder, is eyeing more IMF downsizing and a massive cut to bank funding.
Critics of the moves will argue that weakening the two institutions boosts the China-led Asian Infrastructure Investment Bank (AIIB) launched in Jan 2016, which gives countries an alternative to the IMF-WB for development needs.
The IMF has been downsizing for years, and the Fall meeting is likely to be looking for areas where more cuts can be made. A new round of cuts might handicap IMF Chief Christine Lagarde’s call, made at the conclusion of the G20 Summit in Germany, for strengthening global growth and building inclusive economies. The cuts might also impact France’s plan to use IMF help to reform the country’s labor market while cutting its deficit. President Emmanuel Macron won office in May on promises to overhaul both.
The Republican-controlled U.S. Congress is considering cutting more than half a billion dollars, or almost half of U.S. funding, for the Bank. According to the Bloomberg news service, the bulk of the cut comes from the International Development Association (IDA), one of the five WB agencies. The IDA provides low-interest loans to 77 of the world’s poorest countries, including 39 in Africa. An unnamed appropriations committee aide told the news service that given the budget caps, “difficult choices had to be made.” The cuts will also impact the Global Environment Facility, the global agriculture and food security program and the International Bank for Reconstruction and Development.
About 10,000 people attend IMF/WB meetings officially, and thousands more unofficially. The unofficial thousands usually include anti-globalization and anti-capitalism demonstrators.