World Bank managing director of operations on Tuesday said it would press for more grants and new capital from member countries to fight global crises. 

Anna Bjerde, in an interview, said the extra grant was necessary even as it leverages its balance sheet to scale up lending for responses to climate change and other global crises. 

“We need to really get grants from developed and higher income countries, rich countries, to provide resource transfers to the lower income countries,” she said.

Ms Bjerde said the lender would rally donor support for a newly established crisis facility for the world’s poorest countries that face overlapping global crises, including severe climate events. 

The director said, “We hope to be able to really conclude and have a very strong interest in funding this by the end of the year,” adding that multiple billions of dollars were needed for the crisis facility. 

That facility sits within the International Development Association (IDA) fund, the World Bank’s fund for the poorest countries. The pandemic fast depleted the last replenishment.

COVID-19 pushed many poor countries into debt distress as they were expected to continue servicing their obligations despite the massive financial shock. 

Ms Bjerde said she hopes for major progress in courting interest in the facility at the annual meetings of the International Monetary Fund (IMF) and World Bank in Morocco in October. 

The World Bank, whose 25-member executive board on May 3 elected a new president, wants to increase lending to ensure it can better tackle issues such as climate change, pandemics and conflict. 

“We need to continuously work on what we call under the evolution roadmap a better bank but also a bigger bank,” Ms Bjerde said.

The World Bank’s “evolution road map” calls on its management to develop proposals to change its mission, operating model and financial capacity.

It also prescribes exploring options such as a potential new capital increase to unlock more lending and new financing tools.

The capital increase was an ongoing conversation that needed engagement with shareholders, Ms Bjerde said.

In April, U.S. Treasury Secretary Janet Yellen said the World Bank’s next steps include potential changes to allow the bank’s private sector and poor country lending arms to lend to sub-sovereign entities such as cities and regional authorities.

Ms Bjerde said the sub-national lending was something the World Bank “would very much like to explore further”.

(Reuters/NAN)