Spending the World Bank capital increase
The shareholders of the World Bank Group (WBG) agreed to a negotiated financial and policy package at the April 2018 bi-annual meeting. The proposed 13-billion-dollar paid-in capital increase will be the largest on record. Although the United States will not participate in the increase, Chinese and US concessions enabled the grand bargain, signalling the resilience of multilateralism in global development.
The deal will significantly benefit China as a shareholder but will be to its detriment as a World Bank borrower.
Financing will become cheaper and more plentiful for middle-income countries of below 6,895 dollars gross national income (GNI) per capita.
Private investors will gradually gain access to more WBG instruments and to new markets in low-income and fragile countries.
