Over 13,000 People To Attend World Bank, IMF Meeting In US

 

No fewer than 13,000 people are expected at this year’s meeting of the World Bank and the International Monetary Fund.

The annual event, which opens on Tuesday, will take place in Washington D.C., the United States.

It will bring together governors of various central banks, ministers of finance and development, private sector executives, civil society, and academics.

Participants are expected to discuss issues of global concern including the world economic outlook, global financial stability, poverty eradication, jobs and growth, economic development, and aid effectiveness among others.

Top government officials from Nigeria are also expected at the meeting and would possibly share experiences on what the Federal Government has been doing to address income inequalities, job creation, and improve the nation’s human resources.

The meeting is also expected to offer an opportunity for civil society organisations to share their views and interact with policymakers in a global setting.

World Bank Slashes 2019 Growth As Global Trade Slackens

 

The World Bank slashed its global growth forecasts for this year in a report released Tuesday that portrayed a world gripped by deepening trade conflict, tumbling confidence and increasingly skittish investment.

Although the global development lender currently expects a modest recovery 2020 and 2021, the bank said in its semi-annual report that a lot will have to go right for this to happen.

Instead, the growing risks suggest the outlook could instead grow darker still.

The greatest danger on the horizon is the prospect of worsening trade clashes between major world economies — a specter that rose again last week when US President Donald Trump announced fresh punitive duties on Mexican goods in a dispute over immigration policy.

The world economy is now expected to expand by 2.6 percent this year, three tenths of a percentage point lower than the January forecast, and well below the three percent growth seen in 2018, according to the Global Economic Prospects report.

The World Bank also sounded the alarm about rising debt levels and warned emerging economies they could soon regret the decision to borrow in search of a growth boost.

Newly-installed World Bank President David Malpass, who in his previous position with the US Treasury participated in Trump’s stalled trade negotiations with China, said global growth is “fragile” and the slowdown jeopardizes progress in battling world poverty.

“The global economic outlook, in both the near and long term, is confronting substantial challenges,” he told reporters.

The new forecast was decidedly gloomier than the latest outlook by the International Monetary Fund, released in April, but which likewise predicted a slowdown and warned of the risks posed by trade conflicts.

“The bottom line is that the global economy is coming to a crossroads,” said World Bank economist Ayhan Kose, who oversaw the report, told AFP.

“We need to find ways to stabilize growth and I think further escalation of these trade tensions is now the number one risk that could actually weigh on the outlook,” he told AFP.

World trade volume also is expected to drop off sharply, growing by 2.6 percent this year, the slowest pace since the global financial crisis and a full percentage point lower than January’s forecast.

– ‘Panic button?’ –
In East Asia and the Pacific, total economic output is likely to drop below six percent for the first time since the Asian financial crisis more than 20 years ago.

China’s forecast is little changed, with growth projected to slow to 6.2 to percent this year.

The forecast for the United States is unchanged, with GDP growth slowing to 2.5 percent this year before weakening to 1.7 percent in 2020, though still considerably stronger than other advanced economies.

But American exports to Europe and Asia have seen an “especially acute” slowdown, and conditions in the eurozone economic have “deteriorated rapidly” as exports to China, central Asia and elsewhere have shrunk, according to the report.

Latin America’s top two economies, Brazil and Mexico, have taken sharp turns for the worse.

The report did not take Trump’s latest tariff threat against Mexico into account — it was announced Friday and is due to take effect June 10 — but the World Bank cut the forecast by 0.3 points, calling for expansion of just 1.7 percent in 2019.

If Trump follows through on his threat, tariffs on all Mexican goods would hit 25 percent in October.

“The big question is, are we pushing the panic button?” Kose said.

“The answer at the moment is no but I think if tensions escalate further, we have to push the panic button and get ready for a much deeper slowdown.”

The forecast also sliced 0.7 percent off its outlook for Brazil, cutting it to 1.5 percent.

Kose highlighted concerns over rising debt, saying that since 2007 sovereign debt among emerging and developing economies had risen on average by 15 percent.

These countries should be “extremely careful” not to allow current low interest rates to entice them into overindulging in more debt, and should instead opt for more reforms that can stimulate investment.

“When you accumulate debt, it makes you more vulnerable to crisis, it limits your policy space and then ultimately, you never know when the interest rate’s going to increase,” he said.

Removing Fuel Subsidies Is The Right Way To Go, IMF Tells Nigeria

The Managing Director, IMF, Christine Lagarde at a press conference on Thursday, during the on-going joint annual spring meetings with the World Bank in Washington DC.

 

The International Monetary Funds (IMF) has asked the Nigerian Government to consider the complete removal of fuel subsidy.

IMF Managing Director, Christine Lagarde, who said this at a press conference on Thursday, noted that it was the right way to go.

Addressing a joint annual spring meeting of the World Bank in Washington DC, United State, she explained that the move would save a lot fiscally and in terms of human lives.

“We believe that removing fossil fuel subsidies is the right way to go,” Lagarde affirmed.

She added, “If that was to happen, then there would be more public spending available to build hospitals, to build roads, to build schools, and to support education and health for the people.”

READ ALSO: IMF, World Bank Urge Caution With China Loans

The IMF boss revealed that the figures spent on subsidy from 2015 were staggering.

She, however, urged the government to put in place a social protection safety net while the subsidy was being removed, to reduce its effect on the people.

“If you look at our numbers from 2015, it is no less than about $5.2 trillion that is spent on fuel subsidies and the consequences thereof,” she said.

Lagarde added, “And the Fiscal Affairs Department has actually identified; you know how much would have been saved fiscally but also in terms of human life if there had been the right price on carbon emission as of 2015. The numbers are quite staggering.

“Now, how this is done is more complicated because there has to be a social protection safety net that is in place so that the most exposed in the population do not take the brunt of the removal of subsidies principle. So that is the position we take.”

According to the IMF boss, with the low revenue mobilisation that exists in Nigeria in terms of tax-to-GDP, the nation is amongst the lowest.

She said there was a need for “a real effort” to maintain a good public finance situation for the country and in order to direct investment towards health, education, and infrastructure.

The IMF had in a recent ‘Staff Article IV consultation report on Nigeria’ made recommendations that the fuel subsidy should be removed.

American David Malpass Named World Bank President

David Malpass speaks after US President Donald Trump announced his candidacy to lead the World Bank during an event in the Roosevelt Room of the White House in Washington, DC.  Brendan Smialowski / AFP

 

David Malpass, a senior US Treasury official in President Donald Trump’s administration, was unanimously chosen Friday as the next president of the World Bank.

The selection of Malpass by the bank’s board of directors followed an “open, transparent” nomination process in which citizens of all membership countries were potentially eligible, the bank said in a statement.

But since the bank’s creation following World War II, all of its presidents have been American men, following an unwritten rule that also ensures European leadership at the top of its sister institution, the International Monetary Fund.

The announcement came as expected just prior to next week’s joint spring meetings of the World Bank and the IMF.

Malpass begins his five-year term on Tuesday, replacing former President Jim Yong Kim, whose surprise departure in February came not even halfway through his second term.

Malpass had been the lone candidate for the job and his nomination by Trump earlier this year sparked outrage among critics, who saw it as an affront to the global anti-poverty lender’s very mission.

The 63-year-old US Treasury official in charge of international affairs has been a strident critic of global financial institutions — calling their lending practices “corrupt” and ineffective, and complaining they are overly generous to China.

He has softened his message recently, however, saying he is committed to the bank’s mission of eliminating extreme poverty and that reforms enacted last year as part of a $13 billion capital increase addressed many of his criticisms.

In recent years, emerging market countries have challenged the unwritten arrangement on World Bank and IMF leadership, demanding a more open, merit-based selection process.

The bank has been at pains to stress that it has heard such criticisms and now allows a more open process. But the few non-American candidates in recent years have received little support from major bank shareholders.

Many, including former Treasury officials from both political parties, have sharply criticized Malpass and his qualifications.

They pointed to his failure to foresee the global financial crisis during his time at the now-defunct investment bank Bear Stearns and his opposition, which later proved unjustified, to post-crisis Federal Reserve policies.

Malpass previously also held a senior role in the US State Department for Latin American affairs.

“David will be an exceptional leader of the World Bank and I look forward to working with him in his new role,” US Treasury Secretary Steven Mnuchin said on Twitter.

AFP

ECA, World Bank Say Innovation Key To Addressing Africa’s Job Challenge

ECA, World Bank Say Innovation Key To Addressing Africa’s Job Challenge

 

In order to provide enough jobs for its growing youthful population, Africa must innovate.

This is the view of the Executive Secretary, Economic Commission for Africa (ECA), Vera Songwe, who proposed immediate action on all fronts to address the continent’s jobs challenge in a structural way.

In a statement issued by the Communications Section of the ECA, she says that with Africa’s rising population, estimated to increase to 1.7 billion by 2030, a growth rate of more than 8 per cent per annum is needed to create at least 120 million jobs for the youth entering the labour market between now and 2030.

Ms Songwe who was speaking in Addis Ababa, the Ethiopian capital, at a joint ECA-World Bank roundtable on jobs and economic transformation, said, “The question around jobs and economic transformation is one that almost every African leader is worrying about.”

“Africa is growing again but we need to do better and more. It is disheartening every day to see that more Africans are falling into poverty. That is why it is imperative that we are having this discussion of creating jobs on the continent.”

The event focused on three topical areas: digital transformation, trade and global value chains, and human capital for jobs.

Stressing the importance of innovation as a major force for economic growth and development, Ms Songwe added, “Digitalisation is, now more than ever, playing an important role in Africa’s economic transformation and has the potential to open opportunities to labour markets, moving beyond markets through the free movement of people.”

Ms Songwe also spoke about the need for African economies to stimulate adequate industrialisation through increased intra-African trade.

“As digitalisation and trade create new opportunities for economic transformation through jobs, it will be important for policymakers to recalibrate policies towards strengthening human capital. Policies geared towards a highly skilled, knowledgeable and healthier population are pertinent in ensuring prosperity and thereby reducing poverty on the continent,” she said.

In his own contribution, the Vice President for Development Finance at the World Bank, Akihiko Nishio, said the discussing on jobs and economic transformation was timely.

“For most developing countries and development institutions like ours, the need for more and better jobs remains a top development priority. Jobs are a source of income, a means of raising productivity, and for meeting the aspirations of hundreds of millions of people,” said Mr Nishio.

While admitting that there are challenges in meeting the job needs on the continent, Mr Nishio also pointed out the consequences of failure in tackling the issue.

“Failing to deliver good jobs for the growing youth population not only risks squandering the demographic dividend but raises significant social risks, contributing to fragility and driving young people to migrate abroad in search of better opportunities,” said Mr Nishio.

He said tackling the jobs challenge requires economic transformation, which involves “moving workers from lower to higher productivity activities led by a vibrant private sector and supported by public policy actions.”

El-Rufai Blasts Shehu Sani, Insists Senator Will Be Defeated

 

Malam Nasir Ahmad El-Rufai has said that Senator Shehu Sani is an opportunist who is not working in the best interest of the Kaduna people. 

The Kaduna state governor made this assertion in a discussion with Ladi Akeredolu-Ale on Channels Television’s Roadmap 2019.

He said what Shehu Sani is doing is to take “one’s advantage position to frustrate the development of a State” thus “putting politics above common sense”.

While claiming that the expectations and ambitions of the Kaduna state government have been realized to some extent, El-Rufai said the people were quite “disappointed by the attitude of the Senators representing” the state.

He claimed Shehu Sani and two other lawmakers representing Kaduna had frustrated the efforts of the state government to obtain a $350million loan which would have helped in the area of infrastructure.

Shehu Sani had in a similar interview spoken about a proposed loan of $350million which Kaduna state was to collect from the World Bank.

In the chat on that episode of Roadmap 2019, Sani said “Kaduna state wasn’t qualified for that loan because it was the second most indebted state in the country.

He said the state is indebted to “over $225million and he was asking us to approve $350million for him and then the state will be indebted to over half a billion dollars”.

The lawmaker representing Kaduna Central in the Senate went on to say that “a non-oil producing state with very low internally generated revenue” needed to be saved from the “Chains and shackles of debt” which “He (the governor)” was going to get them involved in.

Disagreeing with Senator Sani, Governor El-Rufa told Ladi Akeredolu-Ale that “Anyone WHO represents a people and does not want the benefits of those people is clearly an enemy of the people”.

The governor went to say that, Shehu Sani uses words without knowing their meaning, noting that “there is no way a state government can borrow without clearance from the debt management office of the Federal Republic of Nigeria”.

“There is no way the World bank will lend you or any other person money without doing their number,” El-Rufai said.

Questioning Senator Shehu Sani’s logic with regards to moving against the proposed World Bank loan, Governor El-Rufai asked, “Is Shehu Sani as knowledgeable or does he know enough economics or financial management to contest the judgment of these institutions?”

He concluded that all Shehu Sani has said is just to “Justify taking actions against the interest of 10 million people”.

Though agreeing that Kaduna has the second largest amount of foreign debt after Lagos, the governor, however, stressed that “what is important is not the level of debt but debt sustainability”.

The governor noted that he is working with the president and he is certain that soon enough the loan issue with the World Bank will be resolved, noting that he is confident with the resolution of some of the issues around financing, “we would be able to get to where we want to take Kaduna State in the shortest possible time”.

World Bank Cuts Global Growth Forecast Amid US-China Trade Conflict

World Bank Approves $350M Loan For Kaduna Govt

 

Growth of the world economy is expected to slow as the US-China trade conflict takes its toll and undermines confidence, the World Bank said Tuesday in its semi-annual forecast.

The World Bank cut the global GDP forecast to 2.9 per cent this year and 2.8 per cent in 2020, slightly below the previous forecast, but warned that risks were rising and urging policymakers to prepare for a storm.

US economic growth is expected to slow this year by four-tenths of a point, falling to 2.5 per cent down from 2.9 per cent in 2018, and to slow even further next year to 1.7 per cent, according to the Global Economic Prospects report.

World Bank President Jim Yong Kim Announces Resignation

 

World Bank President Jim Yong Kim announced Monday he would step down next month, more than three years before his current term was due to expire.

The decision ends Kim’s six-year tenure and may give US President Donald decisive influence over the future leadership of the global development lender.

“It has been a great honor to serve as president of this remarkable institution, full of passionate individuals dedicated to the mission of ending extreme poverty in our lifetime,” Kim said in a statement.

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Kim, who became president in 2012, is to join an as-yet unnamed firm focusing on investments in developing countries, the bank said in a statement, and will return to the board of Partners-in-Health, which he co-founded.

Under Kim’s leadership, the bank set the goal of eliminating extreme poverty by 2030 and ramped up financing.

Last year, it also won approval for a sharp $13 billion capital increase after acceding to requests from the Trump administration to curb loans to high-income countries like China.

Kim’s tenure was also marked by high levels of disaffection among World Bank staff, who chafed at a widespread internal restructuring that Kim began.

World Bank CEO Kristalina Georgieva will serve as interim president upon Kim’s February 1 departure, the bank said in a statement.

Nearly Half The World Lives On Less Than $5.50 A Day – World Bank

 

 

Despite progress in reducing extreme poverty, nearly half the world’s population lives on less than $5.50 a day, with a rising share of the poor in wealthier economies, the World Bank said on Wednesday.

In a twice-yearly report, the bank took a broader look at poverty to see where countries were lagging, even though the share of those living in extreme poverty defined as earning less than $1.90 a day has continued to come down in recent years.

Under the expanded criteria for poverty, the report found the number of poor worldwide was still “unacceptably high,” while the fruits of economic growth were “shared unevenly across regions and countries.”

Even though the global growth of recent years had been sluggish, the total count of people in poverty declined by more than 68 million people between 2013 and 2015 — “a number roughly equivalent to the population of Thailand or the United Kingdom.”

Despite the improvement, the report said current trends indicated the WorldBank’s goal of reducing extreme poverty to less than three percent of the world’s population by 2030 may be unattainable.

“Particularly distressing findings are that extreme poverty is becoming entrenched in a handful of countries and that the pace of poverty reduction will soon decelerate significantly,” the report said.

At the $5.50-a-day threshold, global poverty fell to 46 percent from 67 percent between 1990 and 2015. The bank reported last month that extreme poverty had fallen to 10 percent in 2015.

With China’s rise, East Asia and the Pacific saw a 60 point drop in the poverty rate to 35 percent, but the region is unlikely to continue to achieve that pace going forward as growth has moderated.

And poverty is becoming entrenched in Sub-Saharan Africa, where 84.5 percent of the population still live on less than $5.50 a day, the report said.

And while two decades ago, 60 percent of the global population lived in low-income countries, by 2015, that had fallen to nine percent.

The World Bank also cautioned that in many of those countries, the poor were not sharing equally in economic growth.

AFP

World Bank Offers Disaster-Hit Indonesia $1billion

Medical team members help patients outside a hospital after an earthquake and a tsunami hit Palu, on Sulawesi island on September 29, 2018. PHOTO: MUHAMMAD RIFKI / AFP

 

The World Bank on Sunday announced funding of up to $1 billion for Indonesia after it was rocked by a string of recent disasters, including a deadly earthquake-tsunami that killed thousands.

CEO Kristalina Georgieva unveiled the funds at Indonesian holiday island Bali, where the Bank and the International Monetary Fund have been holding their annual meetings.

A 7.5-magnitude quake and a resulting tsunami tore through Palu city on Sulawesi island on September 28, killing more than 2,000 people and leaving thousands more missing, presumed dead.

Rescue teams scoured the wreckage for a fortnight before calling off the search for the dead, acknowledging as many as 5,000 missing people might never be found.

Georgieva said the funds being made available by the Bank in the form of loans could be used for reconstruction but was also intended to help Indonesia build “resilience”, so it would be better prepared in the face of future disasters.

“Disasters will continue to hit and with climate change, there will be more,” said Georgieva, who visited Palu earlier this week.

“The best memorial we can build for the victims of disaster is to build better, so next time when a disaster hits fewer people are affected, fewer lives are lost, and there is less damage.”

Nearly 90,000 people were displaced by the quake in Palu, forcing them into evacuation centres across the rubble-strewn city.

Officials said it could be two years before all the homeless are found permanent accommodation.

Aid groups say a dearth of clean drinking water and medical supplies remains a very real concern for 200,000 people in urgent need.

Donations have begun pouring into the coastal city of 350,000 after a slow start which saw Indonesia criticised for stalling the flow of relief supplies.

The shallow 7.5-magnitude tremor was more powerful than a series of quakes this summer that killed more than 550 people on the Indonesian island of Lombok and neighbouring Sumbawa.

Indonesia has been hit by a string of other deadly quakes, including a devastating 9.1-magnitude tremor that struck off the coast of Sumatra in December 2004, killing 220,000 throughout the region, including 168,000 in Indonesia.

Indonesian Finance Minister Sri Mulyani Indrawati welcomed the pledge.

“This is not one earmark for a certain project, this is something that can be used by the government to support (people) during this uncertain time,” she said.

The funding was particularly important in the current economic climate, she said, “with much higher interest rates, tightening of liquidity, (it is) a much harder environment for us to get financing from outside”.

Indonesia is one of the most disaster-prone nations on earth.

It lies on the Pacific “Ring of Fire”, where tectonic plates collide and many of the world’s volcanic eruptions and earthquakes occur.

AFP

Edo Govt Strengthens Partnership With World Bank On Agriculture

Edo Govt Strengthens Partnership With World Bank On Agriculture
Edo State Governor, Godwin Obaseki (file )

 

The Edo State Governor, Godwin Obaseki, says strengthening partnership with the World Bank in agricultural development will usher the state into a new era of prosperity.

Governor Obaseki, who said this on Tuesday at a meeting with a team from the World Bank at the Government House in Benin City, was also hopeful that the move would directly impact on the lives of the people.

He said the state government has implemented crucial reforms to encourage transparency, probity, and accountability in public finance and policy implementation.

According to the governor, the state government has also ensured the implementation of reforms that have made Edo attractive to investors and development partners, especially in the areas of capacity building, technical education, innovation and technology growth, as well as sustainable development goals among others.

He explained that the focus on technical education has attracted investment from the World Bank in the rehabilitation project which he said would see the technical school offer top-of-the-range education in the field and award globally-respected certificates to students.

On their part, the World Bank team assured the governor of continued support for his developmental projects and for reforms in Edo for the benefit of the people.

The state government has been pursuing a multipronged-agricultural development plan, which led to a recent visit to the International Institute of Tropical Agriculture (IITA) to the state.

The visiting World Bank team consists of its Agricultural Economist, Adetunji Oredipe, and Lead Financial Management Specialist (Governance Global Practice), Parminder Brar.

The meeting followed extensive engagements of the state government with top officials of the World Bank.

The bank had sent expanded teams to Edo in the last couple of months, to assess the progress of development efforts by the government, including the Edo-Azura Power Project which the Bretton Woods institution is a major partner.