World Bank President David Malpass has chided other development banks for lending too quickly to heavily indebted countries, saying some were helping worsen already-challenging debt situations.
Malpass saidat a World Bank-International Monetary Fund debt forum in Washington that theAsian Development Bank, the African Development Bank, and the European Bank forReconstruction and Development were contributing to debt problems.
Malpass saidwe have a situation where other international financial institutions and tosome extent development finance institutions as a whole, certainly the officialexport credit agencies, have a tendency to lend too quickly and to add to thedebt problem of the countries,. He said the Asian Development Bank waspushing billions of dollars into a fiscally challenging situation in Pakistanwhile the African Development Bank was doing the same in Nigeria and SouthAfrica. A spokesman for the Asian Development Bank could not immediately bereached for comment. The Manila-based development lender in December approved$1.3 billion in loans for Pakistan, including $1 billion for immediate budgetsupport to shore up the countrys public finances and $300 million to helpreform the countrys energy sector. The loans came as the country is strugglingwith billions of dollars in debt to China from Belt and Road infrastructureprojects, which helped cause Pakistan to turn to the IMF for a $6 billion loanprogramme in 2019.
He saidthere needed to be more coordination among international financial institutionsto coordinate lending and maintain high standards of transparency. And so wehave a very real problem of the IFIs themselves adding to the debt burden and,and theres pressure then I think on the IMF to sort through it and look at thebest interest for the country, he said.