world bank World Bank President Ajay Banga said the bank will release more independent data, including on debt defaults, starting next week as part of a push to attract private sector investment to developing countries.
Banga, speaking at the China Development Forum early Sunday morning China time, said the World Bank Group mobilized $41 billion in private capital for emerging markets last year and committed another $42 billion to private debt issuance. He said that the total amount for both would be higher as he was procuring it from the department. this year.
However, he said more progress was needed and the bank was taking action on a number of fronts to overcome barriers to private sector investment in developing countries.
Banga said economic growth is slowing in developing countries, with growth rates falling from 6% to barely 4% over the past 20 years, with each percentage point lost pushing 100 million people into poverty. , pointed out that debt levels are rising.
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Even in developing countries, Banga said there was an “unimaginable” gap between the 1.1 billion young people expected to enter the workforce over the next decade and just 325 million jobs expected to be created. He pointed out that he was facing.
He said that to better understand the issues, the bank convened a focus group of 15 chief executives from asset managers, banks and operators to discuss regulatory certainty, political risk insurance and currency risk. The company has identified concerns such as:
Last month, the bank already announced reforms to consolidate its loan and investment guarantee structures, tripling annual guarantees to $20 billion by 2030.
Banga said that starting next week, the consortium of banks and development agencies will also start publishing private sector recovery data by county income level, as a step to boost investor confidence.
He said the World Bank would also publish private sector default data broken down by rating, as well as sovereign default and recovery statistics going back to 1985.
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“All these efforts contribute to one goal: to bring more private sector capital into developing economies, increasing their impact and creating jobs,” Banga said.
The former Mastercard CEO said the bank is also working on a long-term effort to build a securitization platform that will make it easier for pension funds and other institutional investors to move $70 trillion into emerging markets. He said he was.
Bringing together large standardized investments into one package facilitates meaningful investments at scale, overcoming a patchwork of smaller bespoke loans, each with its own documentation, risks and pricing. He said it can be done.
Banga said China's “remarkable progress” over the past 50 years was proof of what was possible, noting that China has created hundreds of millions of jobs, significantly reduced poverty and cut emissions. did. China, once a major borrower of the World Bank, is now one of its largest donors, he added.
