World Bank Shift to Climate Change Isn’t What We Need
The original mission conceived during World War II to promote global economic cooperation and growth is more important than ever.
IMF Managing Director Kristalina Georgieva promises to put climate at the heart of the global fund’s work.
Photographer: Mandel Ngan/AFP/Getty Images
There was a downer vibe at the IMF/World Bank meetings this week. The World Bank Group told the international community to brace for low growth and the possibility of a lost decade. The International Monetary Fund warned of low growth and considerable downside financial risks on top of it. Yet part of the reason we should be pessimistic about future growth stems from both institutions falling short of their missions to promote economic cooperation, trade and pro-growth policies like market-based investment. The economic slowdown shows why the original mission is exactly what the world needs most now, but instead they’re shifting focus and risk becoming even less relevant in the future.
The IMF and World Bank were created in 1944 at the Bretton Woods Conference, which aimed to remake the world economic order and avoid mistakes from the past. In the aftermath of the Great Depression, and with then-ongoing World War II, there was a recognition that short-sighted nationalist economic policy restricting trade and other beggar-thy-neighbor policies would harm growth and undermine financial stability for everyone. Countries overwhelmed by debt also needed assistance, or their problems could become the world’s problem. The global economy would be best served by better coordination and cooperation among nations.