On July 16, 2015, World Bank Group President Jim Yong Kim and Chinese Finance Minister Lou Jiwei signed an agreement creating a $50 million trust fund to help alleviate global poverty. This agreement will set in motion new investments and organizations that will provide immediate assistance to third world countries all over the globe. The fund also serves to reaffirm the World Bank Group’s relationship with China.
According to the WBG itself, “The trust fund, which is expected to start later this year, aims to enhance the cooperation between China and the WBG and leverage financial and knowledge-based resources to help developing countries achieve inclusive and sustainable development. It will finance investment projects, operations, knowledge development and human-resource cooperation at both global and regional levels.” With the financial support of China’s super economy, the Bank is poised to make real changes for people in poverty.
China’s renewed partnership with the WBG represents a major step forward in the fight against global poverty. This new partnership will begin in late 2015 and continue throughout the upcoming years. WBG President Jim Yong Kim was quoted as saying, “China is a strong partner in development and a strong partner for the WBG, and we share the commitment to ending poverty and boosting shared prosperity.” The marriage between China and the World Bank Group is all the more significant considering that the two were part of a controversy earlier this year.
It was reported by Outlook India that the World Bank Group redacted a criticism of the Chinese economy in a report made on July 3 of this year. An excerpt from the Outlook India article reads, “The World Bank today refuted claims that it withdrew a report critical of China’s financial sector under pressure from the Chinese government and said the economic fundamentals of the country are sound despite the recent equity market volatility.” For any meaningful reform to come out of the new $50 million trust fund, China and the World Bank must find themselves on the same page.
– Diego Catala
Sources: World Bank, Outlook India
Photo: Thanhnien Newsk