By Sophie Edwards, Michael Igoe // 13 October 2017
WASHINGTON — While President Jim Yong Kim makes his final pitch for a capital increase ahead of Saturday’s meeting with the World Bank’s development committee, the institution’s staff, clients, and partners are quietly wondering what the outcome of the bank shareholders’ decision might mean for them.
Kim has repeatedly argued that the International Bank for Reconstruction and Development needs more capital to meet its lending demand, and to meaningfully engage in the areas where the bank’s owners have asked it to engage. In the hallways of the annual meetings this week, some staff members have voiced concern that a failure to secure more money from shareholders — an outcome made likelier by a skeptical U.S. government — could mean job cuts in the future. Others suggest the stakes are considerably lower, and that the bank should not forfeit too much in its quest to win U.S. support.
During a press conference Thursday, Kim told reporters he is “extremely optimistic” the bank’s shareholders are coming around to the idea of a capital increase for the IBRD. More capital would enable the bank to meet demand for its services from low-income and middle-income countries, Kim said, adding that demand has “exploded” in recent years. Shareholders have also been telling the bank to do more, he said, which means the institution needs more funding.
“I think that once shareholders see how much they’re asking us to do and then look at the capital we have to actually get that done, I think eventually we’ll get to a capital increase,” he said.
Even the United States, the bank’s largest shareholder, is at least willing to discuss the possibility, despite their earlier reluctance, Kim said.
“The good news is the US is now very much part of the discussion,” he said, adding, “a new Administration takes time to get organized.”