President Donald Trump’s choice for the post of World Bank President, David Malpass, could be the person African countries are looking for to boost economic assistance from the Bretton Woods Institution, according to people close to the US candidate.
The candidacy of Mr Malpass, currently the Under Secretary for International Affairs at the Department of the Treasury, was announced by Mr Trump days after Jim Yong Kim stepped down as Bank President on January 31, three years before the end of his second term.
Those close to Mr Malpass say that he will be a “constructive” Bank President who will focus on raising the incomes of developing countries.
He has in the past called for the Bank to direct funding where it was needed and to promote successful countries.
“This should be good for Africa, given that the African Development Bank and the African Union reaffirmed their commitment to accelerate Africa’s economic transformation at this month’s AU Summit in Addis Ababa,” one London-based economist told the GNA.
“If these two African institutions get their act together, they could benefit a lot from the World Bank under Malpass.”
Mr Malpass helped negotiate a package of World Bank lending reforms tied to a US$13 billion capital increase that sought to limit its lending and instead focus resources on poorer countries.
The reforms aim to “graduate” more middle-income countries to private sector lending, and limit the growth of the salaries of World Bank staff.
Mr Malpass told the Council on Foreign Relations in Washington in November 2017: “What we’ve challenged the World Bank to do is graduate countries [so] that as they are successful, let’s reduce the lending there and allow more lending to countries that need it.”
He was critical of World Bank lending to Beijing: “The World Bank’s biggest borrower is China.
“Well, China has plenty of resources.”
Mr Malpass also criticised the Bank, the International Monetary Fund and other multilateral institutions for having “grown larger and more intrusive.”
He added: “The challenge of refocusing them has become more urgent and more difficult.”
Speaking at the White House when he introduced Mr Malpass, President Trump said: “David has been a strong advocate for accountability at the World Bank for a long time.
“He has fought to ensure financing is focused on the places and projects that truly need assistance, including people living in extreme poverty.”
African economic experts welcome this and hope that this will lead “to inclusive development policies, especially on the back of marked imbalances in development in most African countries”.
Saloua Sehili, Chief Strategy Officer, and Clement Mensah, a consultant, both with the AfDB, noted that one of the reasons for “widespread underdevelopment is that development aid flowing to African countries –from multilateral development banks or other development partners – tends to have a bias for wealthy regions”.
Writing on the AfDB website, they argued: “Thus, aid ends up in already relatively endowed regions, particularly national capitals and urban areas, a situation that leaves citizens of other regions with the short end of the development stick – poor access to infrastructure, services, decent jobs and the benefits of industrialisation.”
Mr Malpass said at the White House that “a key goal will be to ensure that women achieve full participation in developing economies”.
He said he was “very optimistic that we can achieve breakthroughs to create growth abroad that will help us combat extreme poverty and increase economic opportunities in the developing world”.
Mr Malpass will bring to the job as World Bank President over 40 years’ experience in economics, finance, government and foreign policy.
He currently oversees the World Bank and IMF in his current role within the US government.