Showing posts with label World Bank. Show all posts
Showing posts with label World Bank. Show all posts

Saturday, 10 June 2023

Iran economy to grow at more than 2% in 2023

World Bank in its latest report dubbed “Global Economic Prospects” has estimated a 2.2% growth for Iran's economy in 2023, a figure which is higher than the average growth forecast for the global economy and despite the fact that the country is still under sanctions imposed by the United States.

The Bank has predicted that due to the contractionary monetary policy adopted by many countries this year, the average economic growth in the world is expected to decrease to 2.1% in 2023, from 3.1% in 2022.

Based on the Report, Iran’s Gross Domestic Product (GDP) grew by 4.7% in the last quarter of the previous year, while the average GDP growth for most of the advanced countries like the US, China and many European countries was less than the said figure.

In terms of economic growth, Iran ranked 15th among the world’s 72 major economies in Q42022, which means that only 14 countries had higher economic growth than Iran in this period.

Iran's 4.7% GDP growth in Q4 2022 was achieved, while the average economic growth of developed countries was only 1.2 percent in this period.

The US economy grew by only 0.9% in the mentioned period, the Eurozone by 1.8% and Japan by 0.4%.

China’s economy also grew by 2.9% and India registered a 4.5% economic growth in this period. The average economic growth for West Asia and North Africa region was estimated at 4.9% in the last quarter of 2022.

According to the data, Iran's economy had experienced a 2.9% growth in 2022; the average growth rate in West Asia and North African economies in 2022 was 5.9%.

 

Monday, 27 March 2023

China spent US$240 billion bailing out ‘Belt & Road’ countries

According to a Reuters report, China spent US$240 billion bailing out 22 developing countries between 2008 and 2021, with the amount soaring in recent years as more have struggled to repay loans spent building "Belt & Road" infrastructure.

Almost 80% of the rescue lending was made between 2016 and 2021, mainly to middle-income countries including Argentina, Mongolia and Pakistan, according to the report by researchers from the World Bank, Harvard Kennedy School, AidData and the Kiel Institute for the World Economy.

China has lent hundreds of billions of dollars to build infrastructure in developing countries, but lending has tailed off since 2016 as many projects have failed to pay the expected financial dividends.

"Beijing is ultimately trying to rescue its own banks. That's why it has gotten into the risky business of international bailout lending," said Carmen Reinhart, a former World Bank chief economist and one of the study's authors.

Chinese loans to countries in debt distress soared from less than 5% of its overseas lending portfolio in 2010 to 60% in 2022, the study found.

Argentina received the most, with US$111.8 billion, followed Pakistan on US$48.5 billion and Egypt with US$15.6 billion. Nine countries received less than US$1 billion.

People's Bank of China (PBOC) swap lines accounted for US$170 billion of the rescue financing, including in Suriname, Sri Lanka and Egypt.

Bridge loans or balance of payments support by Chinese state-owned banks was US$70 billion. Rollovers of both kinds of loan were US$140 billion.

The study was critical of some central banks potentially using the PBOC swap lines to artificially pump up their foreign exchange reserve figures.

China's rescue lending is "opaque and uncoordinated," said Brad Parks, one of the report's authors, and director of AidData, a research lab at William & Mary College in the United States.

The bailout loans are mainly concentrated in the middle income countries that make up four-fifths of its lending, due to the risk they pose to Chinese banks' balance sheets, whereas low income countries are offered grace periods and maturity extensions, the report said.

China is negotiating debt restructurings with countries including Zambia, Ghana and Sri Lanka and has been criticized for holding up the processes.

In response, it has called on the World Bank and International Monetary Fund to also offer debt relief.

 

 

Saturday, 25 February 2023

Incoming World Bank Chief, Ajay Banga faces myriad of challenges

Ajay Banga, US President Joe Biden's pick to run the World Bank, will face a tough slate of issues around the institution's finances and capital structure from the get-go, thorny problems he must address as he reshapes the bank into a force for combating climate change on top of its traditional role as a poverty fighter.

Biden and his team have ambitious plans for overhauling the 77-year-old World Bank, which critics have said under its outgoing Chief David Malpass was too timid in financing climate initiatives and still funds substantial fossil fuel projects across the developing world.

The key to it all, of course, is money, and as organized and funded now, the World Bank would be stretched to meet those goals.

Banga's nomination, announced on Thursday, won a round of rapid endorsements as top finance leaders met on Friday in India, a sign his ascendance by early May - or possibly sooner - is all but assured, though other member countries can also submit nominations through March 29 before the World Bank's governors choose the President.

Even before he takes office, the former Mastercard Chief is expected to start working his numerous constituencies as early as April when top officials meet in Washington at the World Bank and International Monetary Fund's spring meetings. Member countries are expected to approve initial moves to stretch the bank's balance sheet to free up more funds for climate projects, pandemic preparedness and other priorities.

If confirmed, he will jump into high-profile talks in June hosted by French President Emmanuel Macron and Barbados Prime Minister Mia Mottley focused on developing a new global financial pact to reform how rich countries finance poor countries grappling with climate-driven damages.

Under Banga's leadership, Mastercard became among the first companies to set net-zero emission targets under the Science Based Targets initiative. He also serves on the advisory board of Beyond Net Zero, a climate finance fund.

Biden administration officials touted Banga's decades of experience building global companies and public-private partnerships to fund responses to climate change and migration.

"Ajay has proven his ability as a manager of large institutions and understands investment and the mobilization of capital to power the green transition," said John Kerry, the US special envoy on climate change.

An even tougher challenge then awaits Banga in winning a capital increase from member countries. This will be especially difficult for the World Bank's top shareholder, the United States, due to political brawling between the Biden administration and the Republican-majority House of Representatives. The House has major sway over the country's purse strings and its leaders are not disposed to widen the World Bank's role in fighting climate change.

In fiscal 2022, the World Bank committed more than US$104 billion to projects around the globe, according to the bank's annual report. Experts say countries will need trillions of dollars to fight and adapt to climate change.

Before an increase can even be considered, US officials say changes in World Bank debt-to-equity ratios and other rules could free up more funds for the climate fight, given the reluctance of a politically divided US Congress to appropriate more funds in a direct capital increase.

An independent report prepared for the Group of 20 major economies said changing the way the bank and other multilateral development banks (MDBs) operate could unlock hundreds of billions of dollars in additional funds.

But some middle-income countries worry that could weaken the bank's AAA credit rating and raise borrowing costs, Mark Malloch Brown, President of the Open Society Foundations told Reuters.

"The middle-income countries worry ... that the cost of borrowing will increase because of the refusal of the West to put up more cash."

Iskander Erzini Vernoit, Director of the Morocco-based climate think tank Imal Initiative for Climate and Development, said the US - which has only contributed US$2 billion of the US$100 billion in climate finance rich countries have pledged - needed to invest more.

"Playing the blame game with management of the MDBs will only get you so far, and not far enough to finance tackling the polycrisis at scale," he said.

 

Sunday, 11 October 2020

United States the biggest war machine

It may not be wrong to say that military bases of the United States are the key pieces of the global war machine, but people don’t hear about these very often. It is estimated 800 US military bases are located around the globe that play an essential role in turning the whole world into a bloody battlefield. These bases are located in more than seventy countries around the world and represent a mighty military presence, yet rarely acknowledged in US political discourse.

The Marine Corps Air Station Futenma in Okinawa might occasionally grab a headline thanks to sustained and vigorous anti-base protests, and US military bases in Guam might briefly make news due to public opposition to “Valiant Shield” war exercises that have taken place on the US colony during the pandemic. But, overwhelmingly, foreign bases simply are not discussed.

They are immutable, unremarkable facts, rarely considered even during elections that repeatedly invokes concepts like “democracy” and “endless war” and, thanks to a raging pandemic and climate crisis, raises existential questions about what United States is and should be.

The people living in the countries and US colonies impacted by these bases — the workers who build their plumbing systems, latrines, and labor in the sex trades that often spring up around them, the residents subjected to environmental toxins and war exercises — simply do not exist.

These military bases hold the key to understanding why the United States has consistently been in some state of war or military invasion for nearly every year of its existence as a country.

US military bases around the world, from Diego Garcia to Djibouti, are nuts and bolts in the war machine itself. Military bases provide the logistical, supply, and combat support that has allowed the United States to turn the whole world into its battlefield. They make conflict more likely, and then more wars lead to more military bases, in a vicious cycle of expansion and empire. Put another way, “bases frequently beget wars, which can beget more bases, which can beget more wars, and so on.”

While the idea that the global expansion of military bases corresponds with the rise of US empire may seem obvious, it is both consequence and cause. The way global military positions spread — which are always sold to the public as defensive — are by their very nature, offensive and become their own, self-fulfilling ecosystems of conquest.

Just as the induced demand principle shows, building more lanes on highways actually increases traffic, United States of War makes the argument that military bases themselves incentivize and perpetuate military aggression, coups, and meddling.

The trajectory toward empire started with white settler expansion within the United States. In 1785, the US Army initiated what “would become a century-long continent-wide fort-construction program. These forts were used to launch violent invasions of Native American lands, to protect white settler towns and cities, and to force Native Americans further and further away from the East Coast.

They were also used to expand the fur trade, which, in turn, encouraged other settlers to keep moving west, with some forts functioning in part as trading posts. The famed expedition of Lewis and Clark was a military mission to collect geographic data that would be used for more “fort construction, natural resource exploitation and westward colonization by settlers.”

While the United States was expanding its frontier, its Navy was also pursuing fort construction overseas, from North Africa’s Barbary Coast to Chile, often for the purpose of securing trade advantages. In the thirty years following the war of 1812 — primarily a war of US expansion — settlers pushed westward within the United States, building infrastructure as they went: roads, trails, and more than sixty major forts west of the Mississippi River by the 1850s. After the United States went to war with Mexico, army bases were constructed in the annexed territory. Forts in Wyoming protected wagon trails, allowing settlers to expand through the western United States.

The violent conquest and massacre of Native Americans did not stop during the Civil War, and it escalated from 1865 to 1898, when the US Army fought no fewer than 943 distinct engagements against Native peoples, ranging from skirmishes to full-scale battles in twelve separate campaigns. White supremacist policies were particularly pronounced in California, but took place across the West. After 1876, when President Ulysses S. Grant turned over Native Americans to the War Department, Fort Leavenworth was transformed into a prisoner of war camp for the Nimi’ipuu tribe.

Over almost 115 consecutive years of US wars against indigenous nations, US military forts played a consistent role in protecting white settler pillaging and conquest.

The War of 1898 was the start of a new form of overseas empire which saw the country expanded across the continent with the help of US Army forts and near-continuous war. In some cases, it’s possible to draw a direct line between expansion within the United States and conquest abroad.

US Army waged brutal battles against the Kiowa, Comanche, Sioux, Nez Perce, and Apache tribes, then ordered cavalry to massacre as many as three hundred Lakota Sioux in 1890, and then violently put down the Pullman, Illinois railroad workers strike in 1894.

A bloody counterinsurgency war in the Philippines was aimed at defeating its independence movement. Similar continuity between domestic and global repression can be found today as counterinsurgency tactics and military weapons and equipment are used by US police departments.

Organized labor, immigrants, recently freed slaves and indigenous peoples at home and abroad were all subdued by the same military and police forces making way for white settlement and capital expansion.

After seizing Spanish colonies during the 1898 war, the US began to pursue a new form of imperialism that was less dependent on the creation of new formal colonies and more dependent on informal, less overtly violent — but violent nonetheless — political and economic tools backed by military might, including bases abroad. The US built up the military presence in the Philippines to seventy thousand troops, using these forces to help put down China’s Boxer rebellion, and used its military might to intervene ruthlessly in Panama.

World War II saw the dramatic expansion of military bases, an era commencing in 1940, when President Franklin D. Roosevelt signed a deal with Prime Minister Winston Churchill to trade naval destroyers for ninety-nine-year leases in eight British colonies, all located in the Western Hemisphere. In the immediate aftermath of the war, the US temporarily shrank military personnel spending, and returned roughly half its foreign bases.

Yet the basic global infrastructure of bases remained entrenched and a permanent war system was established. During the post–World War II era of decolonization, the US used its military base network and economic influence, buttressed by new institutions like the World Bank and International Monetary Fund, to protect its preeminence.

During the Cold War, overseas base expansion became central to the goals of containment and forward positioning, premised on the idea that global bases allow quick response to threats and rapid interventions and deployments in crises. While giving the illusion of increased safety, these bases actually made foreign wars more likely because they made it easier to wage such wars. In turn, conflict increased construction of US bases.

The Korean War, which killed between three and four million people, prompted a 40 percent increase in the number of US bases abroad, and increasing concern about maintaining bases in the Pacific Ocean. Bases also spread across Latin America, Europe, and the Middle East.

CIA stations expanded alongside military bases, and clandestine meddling and supporting coups became a preferred tool of US Empire. When the US waged brutal war in Vietnam, Laos, and Cambodia, it was assisted by hundreds of bases in Japan, Okinawa, the Philippines, and Guam.

The fate of the roughly one thousand Chagossians (descendants of Indian indentured workers and enslaved Africans) from Diego Garcia, an island in the Indian Ocean, spotlights the remarkable cruelty the US during this period of strategic island approach, whereby the US established control over small, colonial islands.

After making a secret agreement with Britain in 1966 to purchase basing rights, the US and UK governments expelled its residents between 1967 to 1973, leaving them trapped on Mauritius and Seychelles, without jobs or homes, many of their possessions lost to them forever.

During some phases of the expulsion, residents were forced onto cargo ships, their dogs killed. By 1973, the US was using this base to support Israel in its 1973 war with Arab nations. To this day,” Vine notes, Chagossians and many others among the displaced are struggling to return home, to win some justice and recompense for what they have suffered.”

The United States used bases from Diego Garcia to Oman to invade Afghanistan in 2001 and, once there, established more bases, and took over former Soviet ones. Likewise, bases from Kuwait to Jordan to Bahrain to Diego Garcia were critical for the 2003 invasion of Iraq, where the US immediately began building bases and installations post-invasion.

While the Bush-Cheney administration closed some bases in Europe, overall spending on bases reached record highs during their time in office. The war with ISIS has seen troops return to Iraq, and the acquisition of bases, even after the Iraqi parliament in 2011 rejected a deal to keep fifty-eight bases in the country.

Since September 11, 2001, the US has also expanded its presence in Africa, building “lily pads” across the continent — smaller profile, somewhat secretive installations, suggesting a frog jumping from lily pad to lily pad toward its prey. US bases have been central to waging the 2011 NATO war in Libya, drone strikes in Yemen, military intervention in Somalia and Cameroon. The military has been conducting a variety of operations regularly in at least 49 African countries.

Meanwhile, base spending has played a key role in the steady uptick of overall military spending. In addition to the direct harm they do through enabling war, bases are associated with incredible fraud and waste, and base contractors renowned for their significant political contributions. This political force, and self-contained logic of sustenance and expansion, is the key to understanding how the Military Industrial Complex can be like Frankenstein’s monster, taking on a life of its own thanks to the spending it commands.

The War on Terror ethos, in which the whole world is considered a US battlefield and the US grants itself broad latitude to wage preemptive war, has come to define US foreign policy. George W. Bush talked about the importance of having a military ready to strike at a moment’s notice in any dark corner of the world to the Middle East, Africa, and Muslim areas of Asia.

Today, the war on ISIS — responsible for significant civilian deaths — continues, so does brinkmanship with Iran, hedging against China, brutal war in Afghanistan, and US support for the war on Yemen, which has unleashed a profound humanitarian crisis.