Reflections and looking ahead

As I end my term as president of the World Bank Group, I have focused extra attention on the strong policies that the world needs to spur production and boost growth.

As I wrote last week in the Wall Street Journal, the global economy continues to face many challenges, with rising interest rates and excessive borrowing inflaming already unsustainable debt levels. The huge buildup of government debt relative to gross domestic product, normalization of artificially low interest rates, and a system allocating capital away from small businesses and toward bond issuers have together reduced dynamism globally. Without change, the world will likely face a long period of slow growth—and developing countries will be hit hardest.

The last four years have been a tumultuous period for the world, punctuated by the COVID-19 pandemic, war in Ukraine, food and energy price shocks, supply chain disruptions, rising inflation and interest rates, and increasingly unsustainable levels of government debt. The World Bank Group has quickly responded to these overlapping global crises, mobilizing a record $440 billion in response to the COVID-19 pandemic and war in Ukraine, sharp global economic slowdown, unsustainable debt burdens, climate change, and food, fertilizer, and energy shortages.?

During my tenure, the Bank has also more than doubled its climate finance to developing countries, reaching a record $32 billion last year. We launched innovative financial instruments, including wildlife conservation bonds, an Emission Reduction-Linked Bond in Vietnam, and a concessional financing trust fund to provide results-based support for emissions reduction. The Bank also introduced a Climate Change Action Plan to better integrate climate and biodiversity with development and growth.

One of my key priorities while at the Bank has been to foster more debt transparency and sustainability—both essential to bolster investment and growth in developing economies. Over the last four years, the Bank has worked with global leaders to break the cycle of unsustainable debt. The WBG has also strengthened debt reconciliation and reporting, resulting in an even more robust International Debt Statistics database. I have continued to push for progress to help countries saddled with unsustainable debt burdens, launching the 2023 Global Sovereign Debt “Roundtable” process in April with the IMF and exploring additional ways to shape the debt restructuring system.

I have also called for a strengthening of private sector investment in development. Amid global trends of slowing growth and rising interest rates, many developing countries are facing a shortage of funds for education, nutrition, health care, and debt service. Given this landscape, private capital will be essential to close financing gaps.

It has been an enormous honor to serve as president of the World Bank Group. I have enjoyed working alongside so many talented and exceptional people to support inclusive and sustainable economic growth and improve living standards for people in developing countries.?

I’m proud that the World Bank Group has continued to respond with speed, scale, innovation, and impact to recent global crises. As I pursue new challenges, I want to thank all our staff and Boards for the privilege of working together to strengthen the effectiveness of our operations in the most challenging of times.

– David