World Bank wel­comes AIIB in poverty fight


China’s new devel­op­ment bank can have an im­por­tant role in fight­ing ex­treme poverty if it es­tab­lishes high stan­dards for its projects, World Bank Pres­i­dent Jim Yong Kim said Tues­day.

Vow­ing to work with an in­sti­tu­tion re­sisted by the United States, Kim called the Bei­jing- led Asian In­fra­struc­ture In­vest­ment Bank (AIIB) “a ma­jor new player in devel­op­ment” that is a “po­ten­tially strong” ally in its own work to help devel­op­ment in the poor­est coun­tries.

“If the world’s mul­ti­lat­eral banks, in­clud­ing the Asia In­fra­struc­ture In­vest­ment Bank and the New Devel­op­ment Bank, can form al­liances, work to­gether, and sup­port devel­op­ment that ad­dresses th­ese chal­lenges, we all ben­e­fit — es­pe­cially the poor and most vul­ner­a­ble,” Kim said in a Wash­ing­ton speech.

“It is our hope — in­deed, our ex­pec­ta­tion — that th­ese new en­tries will join the world’s mul­ti­lat­eral devel­op­ment banks and our pri­vate-sec­tor part­ners on a shared mission to pro­mote eco­nomic growth that helps the poor­est.”

De­spite Wash­ing­ton’s

resis- tance, China has re­ceived ap­pli­ca­tions from more than 50 coun­tries, in­clud­ing im­por­tant U. S. al­lies, to join the AIIB, which will aim at fi­nanc­ing in­fra­struc­ture devel­op­ment around Asia.

The United States and Ja­pan though have re­sisted join­ing, with Wash­ing­ton warn­ing that the AIIB needs to erect strong stan­dards for lend­ing and project devel­op­ment, and be fully trans­par­ent in its ap­proach.

The United States sees the AIIB and a devel­op­ment bank planned by the BRICS emerg­ing­mar­ket coun­tries — Brazil, Rus­sia, In­dia and the PRC — the New Devel­op­ment Bank, as com­peti­tors to the World Bank and the Asian Devel­op­ment Bank, where the United States is the largest share­holder.

Speak­ing at the Cen­ter for Strate­gic and In­ter­na­tional Stud­ies in Wash­ing­ton, D. C., Kim echoed that con­cern.

He stressed that only “with the right en­vi­ron­ment, la­bor and pro­cure­ment stan­dards” can the two new in­sti­tu­tions be­come im­por­tant forces to fight poverty.

In that case, he said, “the World Bank Group sees th­ese devel­op­ment banks as po­ten­tially strong al­lies.”

Kim said he will have talks with Chi­nese au­thor­i­ties next week at the World Bank’s spring meet­ings in Wash­ing­ton on po­ten­tial co­op­er­a­tion.

“I will do ev­ery­thing in my power to find in­no­va­tive ways to work with th­ese banks,” he said.

Kim said such work would help achieve the World Bank’s goal of end­ing ex­treme poverty — lift­ing the liveli­hoods of those living on less than US$1.25 a day — by 2030.

He said that the num­ber of peo­ple be­low the line has fallen from two bil­lion to one bil­lion in 25 years, de­spite a two bil­lion in­crease in the to­tal world pop­u­la­tion.

Kim stressed that more ef­fort is needed to boost global eco­nomic growth.

“The world econ­omy needs to grow faster, and grow more sus­tain­ably. It needs to grow in a way that en­sures the poor re­ceive a greater share of the benefits of that growth.”

With most of the poor­est peo­ple living in ru­ral ar­eas, Kim said, a key fo­cus of the anti- poverty fight is to boost farm yields so that in­comes in­crease.

Part of that, he noted, de­pends on im­proved in­fra­struc­ture.

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