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IMF and World Bank Hold Meetings in Africa After 50 Years

imf and world bank hold meetings in africa after 50 years
imf and world bank hold meetings in africa after 50 years
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International Monetary Fund (IMF) Managing Director Kristalina Georgieva urged affluent nations on Monday to increase their support for financially strained developing countries as she inaugurated the first IMF-World Bank meetings held on African soil in five decades.

These discussions, spanning a week, are taking place in the southern Moroccan city of Marrakesh. The IMF and World Bank are facing mounting calls for reform to enhance their assistance to vulnerable nations grappling with poverty and climate change.

Traditionally, these global financial institutions convene their annual meetings of finance ministers and central bank governors outside of their Washington headquarters every three years. Marrakesh was initially scheduled to host this event in 2021, but it was postponed twice due to the COVID-19 pandemic.

A recent powerful earthquake in the region south of Marrakesh, which resulted in nearly 3,000 casualties, raised concerns about another delay, but the government decided to proceed with the event.

The last time the IMF and World Bank held their meetings in Africa was in 1973 when Kenya served as the host, and some nations were still under colonial rule.

Now, fifty years later, the continent confronts various challenges, including conflict, military coups, persistent poverty, and natural disasters.

Georgieva remarked during a meeting with civil society organizations that bringing the meetings to Africa once more holds both symbolic and substantive significance. She noted that the continent is grappling with problems strikingly similar to those from half a century ago, including high inflation and political instability in several areas.

She emphasized the importance of building trust among nations, stating that many countries are burdened by debt that could overwhelm them, and she expressed hope that these meetings would foster greater cooperation.

Georgieva further called for an increase in the IMF and World Bank’s capacity to support countries in need, including the provision of zero-interest loans on a larger scale. She reiterated plans to reform the institutions’ quota system to allocate more funds to lower-income nations. These reforms would redirect funds that wealthier nations would never require towards developing countries.

However, Western powers are cautious about changes that could grant China more influence through a redistribution of votes.

The World Bank is expected to confirm plans to enhance lending by $50 billion over the next decade through adjustments to its balance sheet. World Bank President Ajay Banga aims to increase capacity by as much as $125 billion through contributions from advanced economies, though this matter is unlikely to be settled in Marrakesh.

Symbolically, the IMF and World Bank are considering granting Africa a third seat on their executive boards.

Georgieva faced scrutiny from representatives of non-governmental organizations (NGOs). Some criticized the quota system as reflecting a neocolonial and racist legacy, while others accused the IMF of imposing austerity measures in countries in dire need of public investment in health and education.

Georgieva denied promoting austerity but emphasized fiscal responsibility, likening it to managing a household budget.

Outside the venue, a dozen activists staged a protest calling for an end to fossil finance and emphasizing dignity over debt.