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World Bank and IMF hold annual meeting in Marrakech
Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva, speaks on the second day of the annual meeting of the IMF and the World Bank, following last month's deadly earthquake, in Marrakech, Morocco, October 10, 2023. REUTERS/Susana Vera
This week the annual meeting of the International Monetary Fund (IMF) and the World Bank takes place in Marrakech, Morocco. It’s been fifty years since their previous meeting on the African continent. These two organisations typically hold their week-long meetings away from their Washington headquarters every two or three years. After two delays due to the COVID-19 pandemic and a potential third delay caused by a recent earthquake, the meeting started on Monday.
The choice of location is particularly significant due to the multitude of challenges Africa is currently facing. Many countries on the continent are grappling with debt crises, the severe impacts of climate change, and a poverty rate that is declining at a slower rate compared to other regions, not to mention a series of coups as well as violence perpetuated by jihadist extremism.
During the opening speech, the IMF Managing Director Kristalina Georgieva emphasized that a prosperous 21st century necessitates a prosperous Africa. One of the initial topics for discussion is the proposal to allocate a third seat on the boards of directors of both institutions to African countries. This move is largely symbolic, but the primary objectives of both organisations remain poverty reduction, assistance to countries in distress, and a focus on climate financing.
However, funding remains an issue, as major countries are reluctant to support a capital increase that would either increase their financial contributions or give more influence to larger emerging nations. Both the IMF and the World Bank use substantial loans and assistance to aid struggling economies. An additional $50 billion in funding is expected to be confirmed during this meeting for use over the next decade. World Bank President Ajay Banga hopes to increase this total to $100 or $125 billion with contributions from advanced economies, without necessitating adjustments to the institutions’ capital structure.
Despite their efforts, these institutions have their critics. Some accuse them of advocating for austerity measures that widen the wealth gap between rich and poor countries. In June, United Nations Secretary-General Antonio Guterres criticized the World Bank and the IMF, stating that their response to the COVID-19 pandemic was a “glaring failure” that left many countries burdened with debt.
It’s unlikely that this week’s events in Marrakech will bring about significant breakthroughs, particularly concerning climate financing. Non-governmental organisations (NGOs) have criticized what they perceive as a lack of determination on the part of these institutions, when the effects of climate change can be seen across the globe.
