IMF, World Bank need a makeover

The annual meetings of the International Monetary Fund and the World Bank currently under way in Marrakesh are a once-in-a-year opportunity to take decisive steps to revitalise the two institutions to better deal with the continuing challenges facing the global economy in the form of slowing economic growth, rising debt distress and the impact of climate change.

The economic backdrop to the meetings is sobering. The IMF’s October edition of its World Economic Outlook projects that global growth will slow from 3.5 per cent in 2022 to 3 per cent in 2023 and 2.9 per cent in 2024 – well below the 3.8 per cent average growth for 2000-2019. Higher-for-longer interest rates will aggravate debt problems, especially in the 26 developing countries that are at high risk of debt distress, according to the IMF. And both the impact of climate change and the need to meet the UN’s sustainable development goals will call for massive increases in financing from multilateral development institutions, of which the IMF and World Bank are the largest.