US assures Ajay Banga of strong support for World Bank

Harris’ assurance to first Indian American World Bank chief comes in the leadup to the September G20 Leaders Summit in India

Vice President Kamala Harris has assured World Bank President Ajay Banga, the Biden-Harris Administration’s strong support for World Bank efforts to make investments and spur policy reforms that reduce poverty and advance achievement of the Sustainable Development Goals.

Harris’ meeting with Banga on June 5 at the White House was the first official US engagement since the first ever Indian American selected for the post took office on Friday, according to a White House readout.

READ: Biden, Harris hail Ajay Banga’s selection to lead World Bank (May 4, 2023)

She conveyed the United States’ intention to work with World Bank shareholders and President Banga in the leadup to the September G20 Leaders Summit in India to agree to steps they will jointly take.

Specifically they would aim to deliver significant new concessional World Bank financing delivered through a new window or other innovative mechanisms to incentivize action on global challenges across all borrower countries.

A new framework and principles for the targeted use of concessional resources will help deploy new financing to where it is most additional and has the highest impact, the readout said.

Another aim would be to deliver enhanced support for addressing the urgent needs of low-income countries, including through contributions to support crisis response in International Development Association recipient countries.

Read: Ajay Banga selected 14th President of the World Bank (May 3, 2023)

Harris, according to the readout, praised the steps taken to evolve the World Bank—including expanding its mission to include building resilience to global challenges like climate change, pandemics, fragility and conflict.

She underscored that addressing these global challenges is interlinked with and indivisible from the Bank’s work to eliminate extreme poverty and promote shared prosperity.

Harris also welcomed Banga’s commitment and high ambition in driving forward this evolution initiative, according to the readout.

Recognizing that the public sector alone cannot meet the immense development needs, Harris also underscored US commitment to work with the World Bank and other shareholders to develop and implement an action plan to raise the level of ambition in mobilizing private investment.

READ: An eventful year ahead for U.S.-India relations (April 1, 2023)

Harris also discussed with Banga her work around the world, from Southeast Asia to Africa to the Caribbean.

In particular, as Harris has made clear in this and other meetings, countries should have access to the finance and tools they need to accelerate the clean energy transition and build resilience to shocks, according to the readout.

Harris and Banga also discussed ongoing work to galvanize private investment in developing countries, particularly in Central America and Africa.

This meeting comes just before the Vice President’s upcoming trip to The Bahamas on June 8 to participate in the US-Caribbean Leaders Meeting, alongside Banga.

READ: Readout of Vice President Harris’s Meeting with World Bank President Ajay Banga (June 5, 2023)

There Harris will further discuss the US commitment and actions to support sustainable and inclusive economic development in the Caribbean.

To this end, she raised the importance of all creditors offering Climate Resilient Debt Clauses to allow a temporary suspension of debt service after a natural disaster, according to the readout.