The White House unveiled its plans on Tuesday, revealing that US President Joe Biden is set to advocate for comprehensive reforms within the IMF and World Bank. This initiative aims to better cater to the needs of developing nations and will be a focal point during the upcoming G20 summit scheduled to take place in New Delhi next month.
As per the statements of White House National Security Advisor Jake Sullivan, these reforms seek to offer a refined alternative to China\’s \”coercive and unsustainable lending\” approach through its Belt and Road Initiative. Sullivan stressed the necessity for the IMF and World Bank to provide a more effective solution that can genuinely support development and financing endeavors, acknowledging the intricate challenges that developing countries face.
Sullivan highlighted that the G20 summit will serve as a strategic platform for President Biden to channel his efforts towards the modernization of multilateral development institutions, including the World Bank and the IMF. The ultimate goal is to ensure that these institutions can offer solutions characterized by both high standards and substantial leverage to effectively address the complex problems faced by developing nations.
Drawing a sharp contrast with China\’s Belt and Road Initiative, which often involves substantial loans for infrastructure and industrial projects in financially vulnerable nations, Sullivan emphasized the transparency and efficiency of the World Bank and IMF. He posited these international institutions as a constructive alternative to China\’s approach.
The United States intends to present proposals during the New Delhi summit aimed at bolstering the lending capacity of the World Bank and IMF by a significant $200 billion.
Sullivan underlined that the US\’s endorsement of these reform and modernization efforts is not intended to antagonize China. Instead, he emphasized that China, being a member of the G20 and a key partner in the IMF and World Bank, holds a pivotal role in the process. The primary objective is to foster the establishment of a more effective and transparent global financial support system.
These statements were made as the BRICS, a forum comprising major emerging economies such as Brazil, Russia, India, China, and South Africa, conducted a summit in South Africa. Sullivan emphasized that the US views BRICS not as a geopolitical rival, but as a diverse and unique collection of nations that contribute to the global landscape in distinct ways.
