UK joins calls for World Bank reform to focus funding on climate crisis

Alok Sharma’s intervention puts pressure on Trump-appointed Bank chief who faces calls to resign

The UK has joined calls for sweeping reforms to the World Bank, to focus much-needed funding on the climate crisis, saying that its current structures are not working.

The intervention from Alok Sharma, the current president of the UN climate talks, heaps further pressure on beleaguered World Bank chief, David Malpass. He has faced calls to resign over an apparently climate-dismissing stance, and the Bank’s perceived failures to deliver climate finance.

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Half of poorest countries have cut health spending despite Covid, says Oxfam

Analysis of budgets finds rich nations, including UK, ‘exacerbated explosion of economic inequality’

Many of the world’s poorest countries have cut health spending during the last two years, sometimes to make debt repayments to rich creditors, according to a report by Oxfam that shows inequality between rich and poor nations worsening during the coronavirus pandemic.

Analysis of national budgets across 161 nations found that despite the biggest global health emergency in a century, half of low- and lower-middle-income countries cut health spending, while almost half cut their welfare budgets and almost three-quarters cut education spending.

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Ukrainian economy will shrink at rate eight times that of Russia, World Bank forecasts

Kyiv economy will contract by 35% in 2022, compared with a 4.5% fall in Russian GDP

Ukraine’s economy will shrink at a rate eight times that of Russia this year as a result of the war triggered by Moscow’s invasion in February, the World Bank has estimated.

In its latest report on Europe and central Asia, the Washington-based institution said the Ukrainian economy would contract by 35% in 2022, compared with a 4.5% fall in Russian GDP.

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China growth lags Asia-Pacific for first time in decades as World Bank cuts outlook

East Asia and Pacific annual growth forecasts downgraded from 5% to 3.2% as China’s economy cools, largely due to zero-Covid policy

Covid-zero policies and the housing market crisis have put China’s economic growth behind the rest of the Asia-Pacific region for the first time in more than 30 years, according to World Bank forecasts.

In a biannual report released on Tuesday, the US-based institution said the annual growth outlook for East Asia and the Pacific region had been downgraded from 5% to 3.2%. However much of that decline was down to economic woes in China, which constitute’s 86% of the region’s economic output.

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World Bank warns higher interest rates could trigger global recession

Study says global economy is in steepest slowdown after a post-recession recovery since 1970

The world may be edging toward a global recession as central banks simultaneously raise interest rates to combat persistent inflation, the World Bank has warned.

The three largest economies, – the US, China and the eurozone – have been slowing sharply, and even a “moderate hit to the global economy over the next year could tip it into recession”, the bank said in a study.

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Sri Lanka is the first domino to fall in the face of a global debt crisis

The south Asian country is the first to buckle under economic pressures compounded by Russia’s war on Ukraine, but it won’t be the last

The departure of Sri Lanka’s prime minister, Mahinda Rajapaksa, follows weeks of protest and a deepening crisis. There is no bankruptcy system for states but if there was then the south Asian country – down to its last $50m (£40m) of reserves – would be first in line to use it.

A team from the International Monetary Fund (IMF) this week started work with officials in Colombo over a bailout that will include a tough package of reforms as well as financial support. But as the IMF and its sister organisation, the World Bank, know full well, this is about more than the mismanagement of an individual country. They fear Sri Lanka is the canary in the coalmine.

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Ukraine war to slow growth and drive up poverty in Asia, World Bank warns

Conflict adds strain to developing economies in east Asia and Pacific already struggling with Covid and inflation

Russia’s invasion of Ukraine has further dampened the economic prospects for developing countries in east Asia and the Pacific, meaning lower economic growth and higher poverty in the region this year, the World Bank has warned.

The Ukraine factor came on top of the existing risks that the region – home to 2.1 billion people and stretching from China to Papua New Guinea – has been facing in recent years. They included the ongoing Covid-19 pandemic, the financial tightening in the US, and the pandemic resurgence amid China’s zero-Covid policies.

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Ukraine war a ‘catastrophe’ for global economy as stock markets plunge

Moscow stock exchange remained closed during the week, while the rouble fell to record lows

The London stock market has suffered its biggest weekly losses since the start of the global pandemic in March 2020, as investors took fright at the escalation of the conflict in Ukraine.

Shares plunged in the City following news of a fire and Russian capture of Ukraine’s Zaporizhzhia nuclear power station, with the one-day drop of more than 250 points in the FTSE 100 index taking the weekly loss to 6.7%.

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We can afford to reverse poverty and climate breakdown. What we can’t afford is the alternative | Kevin Watkins

Our global finance system is failing to rise to the challenges we face. It’s time it was reimagined – and grounded in our shared humanity

“The peoples of the Earth,” Henry Morgenthau said, “are inseparably linked by a deep underlying community of purpose.”

In July 1944, Morgenthau, the US Treasury secretary, was closing the Bretton Woods conference with a reflection on extreme nationalism and the failures of cooperation that had led to war. Cautioning against the pursuit of national interest through “the plan-less, senseless rivalry that divided us”, he outlined an accord for new institutions grounded in an appeal to shared humanity.

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‘Critical lifeline’ of migrant cash expected to near £600bn in total

Sum sent back home from former residents of low-income countries surpasses overseas aid and rich nations’ direct investment

Migrants from low- and middle-income countries are expected to send almost £600bn to support friends and relatives by the end of the year, after global economic growth spurred a 7.3% rebound in remittance payments.

The increase in cross-border payments, especially from migrants based in Europe and the US, reversed a 1.7% fall in remittance payments last year, the World Bank said.

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The world was woefully unprepared for a pandemic. Let’s be ready for the next one | Elhadj As Sy

The Global Preparedness Monitoring Board is calling for a coherent action plan to counter future health emergencies

Two years ago, three months before coronavirus erupted, the Global Preparedness Monitoring Board (GPMB) issued a warning to the international community that a pandemic was only a matter of time, and that the world was not prepared. Tragically, we were proved right.

After 20 months of Covid-19, with nearly five million directly attributed deaths and economic devastation, we say again that the world is not prepared. It has neither the capacity to end the current pandemic in the near future, nor to prevent the next one.

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Covid pandemic has pushed poor countries to record debt levels – World Bank

‘Tragic reversal’ has set back progress, president says, as he calls for a comprehensive plan

The Covid-19 pandemic has led to a “tragic reversal” in development and pushed debt in poor countries to record levels, the head of the World Bank has said.

David Malpass, the bank’s president, warned the virus had widened the gap between rich and poor nations, setting back progress by years and, in the case of some countries, by a decade.

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IMF to issue downbeat outlook as spectre of stagflation looms

Fund set for a gloomy annual meeting as supply chain issues and inflationary pressures hobble global recovery

Weaker global growth, vaccine protectionism and the spectre of 1970s-style inflation haunting large economies. As the International Monetary Fund prepares for its annual gathering this week, the contrast with the spring could not be more stark.

Back in April, at the Washington-based fund’s last virtual bash, there were sharp upgrades for global growth amid a sense of optimism for the road ahead, led by stronger-than-expected recoveries in the US, UK and other advanced economies. Vaccines would pave the way for the swift unlocking of pandemic restrictions, fuelling a rapid recovery from the worst global recession since the 1930s Great Depression.

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IMF boss Kristalina Georgieva ‘faces coup plot’

Renowned economist Joseph Stiglitz says chief is victim of conservative ‘hatchet job’ using unfair report to discredit her

The International Monetary Fund boss, Kristalina Georgieva, is the victim of a plot to oust her, according to a Nobel prize-winning economist, after a report alleged that she applied “undue pressure” on staff to boost China’s standing in global rankings while in her previous job at the World Bank.

Joseph Stiglitz, a former chief economist at the World Bank, said a report prepared by the law firm WilmerHale on concerns about China’s influence at the Washington-based organisation was being used unfairly to “discredit and oust” Georgieva.

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The Taliban are not the only threat to Afghanistan. Aid cuts could undo 20 years of progress

The most vulnerable people will bear the cost of sanctions, as services and the economy collapse

Watching Afghanistan’s unfolding trauma, I’ve thought a lot about Mumtaz Ahmed, a young teacher I met a few years ago. Her family fled Kabul during Taliban rule in the late 1990s.

Raised as a refugee in Pakistan, Ahmed had defied the odds and made it to university. Now, she was back in Afghanistan teaching maths in a rural girls’ school. “I came back because I believe in education and I love my country,” she told me. “These girls have a right to learn – without education, Afghanistan has no future.”

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If education is such a great investment, it deserves serious international backing

The World Bank and IMF should step in to finance a recovery of children’s learning chances devastated by the pandemic

“Education,” wrote Nelson Mandela, “is the most powerful weapon you can use to change the world.” One wonders what he would have made of the response to the education crisis triggered by the Covid-19 pandemic. A crisis threatening to derail social and economic progress, trapping millions of children in poverty. The UN secretary general has warned of a “generational catastrophe”, yet the international response has been marked by staggering complacency.

That lack of concern was on public display at last week’s Global Education Summit in London. Fresh from cutting UK aid to education by 40%, Boris Johnson – a self-styled champion for universal girls’ education – opened proceedings by declaring that education was “the single best investment we can make in the future of humanity”.

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Gross inequality stoked the violence in South Africa. It’s a warning to us all | Kenan Malik

The country’s social contract has broken, fuelled by corruption and extreme poverty

‘It feels qualitatively different this time.” There are few people I know in South Africa who don’t think this about the carnage now engulfing the nation. Violence was institutionalised during the years of apartheid. In the post-apartheid years, it has rarely been far from the surface – police violence, gangster violence, the violence of protest. What is being exposed now, however, is just how far the social contract that has held the nation together since the end of apartheid has eroded.

Many aspects of the disorder are peculiar to South Africa. There are also themes with wider resonance. Events in the country demonstrate in a particularly acute fashion a phenomenon we are witnessing in different ways and in degrees of severity across the globe: the old order breaking down, with little to fill the void but sectarian movements or identity politics.

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Half of Zimbabweans fell into extreme poverty during Covid

Poor families cannot afford healthcare and schooling but good harvests offer some hope, World Bank finds

The number of Zimbabweans in extreme poverty has reached 7.9 million as the pandemic has delivered another economic shock to the country.

According to the World Bank’s economic and social update report, almost half of Zimbabwe’s population fell into extreme poverty between 2011 and last year, with children bearing the brunt of the misery.

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Global economy set for fastest recovery for more than 80 years

Slow Covid-19 vaccine progress in low-income countries will widen divisions between rich and poor nations

The global economy is set for the fastest recovery from recession for more than 80 years, but poor nations are at risk of falling further behind wealthy countries amid slow progress with the Covid-19 vaccine, the World Bank has said.

In its half-yearly outlook report, the Washington-based institution said the world economy was forecast to grow at 5.6% this year, in a sharp upgrade from previous estimates it made in January for growth of 4.1%.

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Protesters call on banks to ‘drop African debt’ in wake of Covid

World’s poorest nations saddled with ‘imprisoning’ debt, hampering responses to the pandemic, say activists protesting HSBC meeting

Activists at a demonstration outside the annual general meeting of HSBC in London have demanded the bank and other financial giants provide debt relief to African countries hit hard by the coronavirus pandemic.

In an attempt to highlight the role of private creditors in the debt crises of the world’s poorest countries, campaigners with “drop the debt” banners gathered outside HSBC’s AGM at the Southbank Centre.

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