World Bank steering committee and US urge for reforms on climate lending

At the World Bank’s spring meeting, US Treasury Secretary Janet Yellen called for the adoption of a reform that would free up funds for climate lending.

The World Bank’s steering committee and U.S. Treasury Secretary Janet Yellen on Wednesday called for further reforms this year to expand the bank’s ability to respond to climate change, pandemics and other crises that are reversing development gains.

Yellen hosted talks with global finance officials to discuss an initial spate of balance sheet changes that will allow the World Bank to lend an additional $50 billion over 10 years while maintaining its top-tier AAA credit rating, and how to deepen those efforts with it and other multilateral development banks.

Yellen said the changes already approved had sharpened the mission of the World Bank, but more “bold action” was needed to ensure it could work to end extreme poverty, boost shared prosperity and better meet 21st century challenges like climate change, fragility and pandemics.

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“We should use the rest of the year to undertake additional reforms through a staged implementation approach that can be agreed upon by the Board and implemented on a rolling basis.”

Climate change demonstrators carry a mock oil pipeline during a “Stop Fossil Gas” protest outside of the 2023 IMF-World Bank meetings in Washington, D.C. on April 12, 2023. (Photo: Reuters/Bryan Olin Dozier/NurPhoto)

Major milestones

The bank’s steering committee – officially known as the Development Committee – met later in the day, where members welcomed the bank’s “Evolution Roadmap” and said they looked forward to additional efforts aimed at achieving “major milestones” by the October annual meetings of the World Bank and International Monetary Fund.

“They expect the Board of Executive Directors and World Bank Group management to finalize a work plan with detailed actions to be taken,” the committee’s chair said in a statement.

Members underscored their commitment to “ensuring that the World Bank Group has adequate financial capacity to respond to development challenges and support its expanded mission.”

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They called for ambitious approaches to increasing private capital, facilitating investment and leveraging the public sector.

The members also looked forward to exploring additional recommendations made by an independent panel last year, including making the bank’s emerging mar

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