The administration of U.S. President Donald Trump is willing to collaborate with the International Monetary Fund (IMF) and the World Bank, provided they remain true to their missions, a senior official stated, noting that the institutions are currently falling short of expectations.
The official emphasized that these organizations must break away from diffused and unfocused agendas that hinder their ability to fulfill their core mandates.
Criticism was specifically levelled at the IMF for dedicating a disproportionate amount of time and resources to social issues, climate change, and gender topics.
These areas, the official argued, do not fall under the primary mission of the IMF, and focusing on them is detracting from critical macroeconomic work.
Speaking at a forum organized by the Institute of International Finance on the sidelines of the IMF and World Bank spring meetings in Washington, he stated, “We are open to criticism but will not tolerate the IMF failing to criticize countries most in need, particularly surplus countries.”
The official called on the IMF to take a stand against countries like China, which has long pursued globally distortionary policies and opaque monetary practices, as well as against unsustainable lending practices by certain creditor countries.
The Treasury Secretary stressed that the macroeconomic organization should refocus its lending on addressing balance of payments issues, adding that loans should be temporary and made responsibly.
Citing Argentina as an example of a country worthy of IMF support, he noted that it is making real progress in meeting financial targets, unlike some other nations.
Addressing the World Bank, the official recalled its original mission to aid developing countries in growing their economies, reducing poverty, boosting private investment, supporting private sector job creation, and limiting reliance on external aid.
He argued against unfocused marketing efforts and insincere reform commitments, urging the Bank to use its resources as efficiently as possible, amidst ongoing government reviews of organizations to which it belongs and supports.
These remarks came a day after World Bank President Ajay Banga reiterated plans to have the Board of Directors lift its veto on financing nuclear energy projects by June.
The official welcomed this goal, advocating for the Bank to be technology-neutral and prioritize energy accessibility and investment.
“In most cases, this means investing in energy production based on gas and other fossil fuels,” he mentioned.
The Treasury Secretary described it as “absurd” that the organization still classifies China as a developing country and urged Washington’s trade partners to work together to rebalance the financial system, the IMF, and the World Bank toward their founding charters: “America First does not mean America alone,” he concluded.
