Ajay Banga was confirmed as the World Bank Group’s next leader on 3 May, giving US leaders hope that the lender will focus more on climate change. He was the only nominee brought forward.
Banga will help bring innovation to the bank and “usher in the fundamental changes in development finance that this moment requires”, US president Joe Biden said in a statement.
“He will help steer the institution as it evolves and expands to address global challenges that directly affect its core mission of poverty reduction – including climate change,” Biden added.
World Bank presidents are traditionally Americans nominated by the US. Banga will start a five-year term on 2 June, the World Bank said in a statement.
Biden nominated Banga, the former CEO of Mastercard, in February after outgoing president David Malpass announced he would resign a year before his term expires. Malpass came under fire last year for avoiding questions on whether he believed man-made emissions were causing global warming.
Although he had a long career in the corporate world, Indian-American Banga has long held that inequality and climate change need to be addressed simultaneously.
The World Bank was established in 1944 to help provide funding following the second world war. Today it oversees billions of dollars of funding for low and middle-income countries but many nations, including the US, are pushing for reforms to allow the lender to focus more on climate financing. At Cop27 in November, a proposal was presented by Barbados prime minister Mia Mottley to increase the bank’s lending capacity by reducing the amount of capital required to hold against loans.
In February, US Treasury secretary Janet Yellen called on the World Bank to take “bolder and more imaginative” steps to address climate change and other global issues. The World Bank has since submitted proposals to unlock US$50bn to help developing countries fight climate change over the next decade.
Yellen said in a statement that Banga “understands that the challenges we face – from combatting climate change, pandemics, and fragility to eliminating extreme poverty and promoting shared prosperity – are deeply intertwined”.
“Our ambitious goals will not be met overnight, and we remain committed to a staged adoption of reforms over the course of the year to build on the vision we have laid out,” she added.
This page was last updated May 11, 2023
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