The new leader of the World Bank said the lender needs to speed up project-approval times that now stretch for two to three years as it works to address trillion-dollar global challenges such as climate change and inequality.
(Bloomberg) — The new leader of the World Bank said the lender needs to speed up project-approval times that now stretch for two to three years as it works to address trillion-dollar global challenges such as climate change and inequality.
The bank needs to do more in less time, eliminating red tape and bureaucracy that slows its work, Ajay Banga said in a statement that was seen by Bloomberg News and shared with the staff on Friday, his first day as president.
Banga called the years now spent going from identification of a project to its approval as an “overly elaborate” process that costs time and undercuts the ambition of World Bank employees.
“The bank itself must evolve,” said Banga, 63, a former Mastercard Inc. chief executive officer, in the memo he sent earlier to the bank’s board. “We have an abundance of challenges – and a scarcity of time.”
Banga took over from David Malpass, who was nominated by former President Donald Trump in 2019 and in February announced plans to step down almost a year early. Banga’s ratification last month gives the Biden administration a chance to evolve the Washington-based institution toward a greater focus on climate change. Environmental activists had said Malpass wasn’t providing leadership on the issue.
US Treasury Secretary Janet Yellen met with Banga on Thursday and said she wants to work with him to maximize the World Bank’s lending impact and mobilize private capital for development goals. Treasury said in a statement that Yellen “looks forward to having Banga’s experienced leadership and proven management skills at the helm of this critical multilateral institution during a period of significant global challenge and opportunity.”
Malpass and International Monetary Fund Managing Director Kristalina Georgieva have been leading a push to get China, the biggest creditor to emerging economies, to participate in debt restructuring for distressed nations, alongside traditional western creditors like the US.
“The World Bank’s challenge is clear,” Banga said in his message to the bank’s board. “It must pursue both climate adaptation and mitigation, it must reach out to lower-income countries without turning its back on middle income countries, it must think globally but recognize national and regional needs, it must embrace risk but do so prudently.”
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