Kate Mackenzie, Lee Harris, and Tim Sahay in The Polycrisis at Phenomenal World:
When the World Bank and IMF make radical noises, the US is typically the voice of restraint. So it came as a surprise to casual observers when, at October’s Annual Meetings, Treasury Secretary Janet Yellen urged the Bank and other multilateral institutions to overhaul their lending practices and get more money out the door more quickly.
Yellen set the ambitious timeline of December for delivering a roadmap for increased lending. Some speculated that she was assigning a task at which David Malpass—the World Bank head who infamously fumbled questions on whether he believes in human-caused climate change—is likely to fail.
This new posture has given life to reforms on which multilateral financial institutions have long dragged their feet. (Just this past summer, the World Bank even attempted to suppress a key report commissioned by the G20 urging greater lending.) And charismatic leadership and nimble advocacy from the Mottley administration in Barbados has made technical questions about lowering the cost of capital politically urgent.
Multilateral Development Banks are subject to a snarl of constraints. Many of these are political checks designed by shareholder nations—the US Congress, for example, can take some blame for the state of the World Bank. But a near-dogmatic inertia and conservatism also severely constrict their scope.