Ajay Banga Era starts at the World Bank
Ajay Banga officially became the World Bank’s 14th president on Friday, urging staff to work with him to develop a “new playbook” for a global institution whose relevance has been questioned in recent years.
The Ascension of Mr. Banga as the bank’s next leader comes at a pivotal time in its 77-year history. The global pandemic has undone decades of poverty reduction progress, Russia’s war on Ukraine continues to threaten economic stability, and the World Bank is under new pressure to become a more ambitious player in the fight against climate change .
“To deliver on our ambition, we will need to evolve to maximize resources and write a new playbook, think creatively, take informed risks and forge new partnerships with civil society and multilateral institutions,” wrote Mr. Banga in a note to staff viewed by The New York Times.
Mr. Banga was nominated by President Biden in February following the resignation of David Malpass, the outgoing World Bank president selected by former President Donald J. Trump. The World Bank board of directors approved Mr Banga in May after an extensive listening tour that included visits to eight countries and dozens of meetings with government officials around the world.
In his message to staff, Mr. Banga the bank’s mission statement as striving to “create a world without poverty on a livable planet.”
It is the second part of that mission on which Mr. Banga will likely be judged.
Mr Malpass left the job a year early after failing to sufficiently demonstrate his commitment to fighting global warming amid a renewed emphasis from the Biden administration broadening the bank’s focus on the environment .
However, Mr Banga, a former CEO of Mastercard, has no extensive climate credentials for the job and will be under pressure to make progress on the bank’s environmental agenda. He has described the tasks of dealing with climate change and poverty as intertwined.
“The World Bank’s challenge is clear: it must pursue both climate adaptation and mitigation; it must reach out to low-income countries without turning its back on middle-income countries; it must think globally, but recognize national and regional needs; it must embrace risk, but do so cautiously,” Mr Banga wrote in a statement to the World Bank’s board of directors that accompanied his memo to staff.
Climate activists plan to appear outside the World Bank on Friday and attempt to hand postcards to staff with demands they want Mr Banga to heed during his first 100 days on the job. They remain frustrated that the World Bank is funding coal, oil and gas projects despite its commitments to prioritize clean energy projects.
Mr. Banga is expected to use his expertise to strengthen World Bank resources and build new partnerships between the private and public sectors. The former finance director added in his memo that achieving the World Bank’s many goals requires an annual global investment of trillions of dollars.
Mr Banga also faces a difficult diplomatic task as he tries to deliver on the climate ambitions of the United States and Europe, while facing the skepticism of some developing countries. He will also take on the delicate task of urging China, a major shareholder and creditor of the World Bank, to allow poor countries that have borrowed huge sums from Beijing to restructure their debts.
The President of the World Bank is traditionally elected by the United States; the managing director of the International Monetary Fund is selected by the European Union.
Mr Banga met with Treasury Secretary Janet L. Yellen on Thursday. They discussed ways to refine the bank’s operation and make it more flexible and responsive, according to a summary of their conversation released by the Treasury Department.