World Bank’s President Jim Yong Kim has warned that the US is just “days away from a very dangerous moment” because of the government’s borrowing crisis.
Jim Yong Kim urged US policymakers to reach a deal to raise the government’s debt ceiling before Thursday’s deadline.
The US Treasury will start to run short of funds if no agreement is reached for it to borrow on financial markets.
Jim Yong Kim urged US policymakers to reach a deal to raise the government’s debt ceiling before Thursday’s deadline
Jim Yong Kim warned this could be a “disastrous event” for the world.
“The closer we get to the deadline the greater the impact will be for the developing world.
“Inaction could result in interest rates rising, confidence falling and growth slowing,” he said speaking at the World Bank’s annual meeting in Washington.
“If this comes to pass it could be a disastrous event for the developing world and that will in turn greatly hurt the developed economies as well,” Jim Yong Kim added.
US nominee Jim Yong Kim has been chosen as the new president of the World Bank.
Jim Yong Kim, 52, a Korean-American health expert, is currently the president of Dartmouth University.
He faced a strong challenge for the post, which has traditionally gone to an American, from Nigerian Finance Minister Ngozi Okonjo-Iweala.
Dr. Jim Yong Kim will succeed Robert Zoellick, serving a five-year term beginning on 1 July, the World Bank said in a statement.
Jim Jong Kim is a doctor lauded for his pioneering role in treating HIV/Aids and reducing the impact of tuberculosis in the developing world.
US Treasury Secretary Timothy Geithner said the new president’s background would be valuable in the role.
“His deep development background coupled with his dedication to forging consensus will help breathe new life into the World Bank’s efforts to secure fast economic growth that is widely shared,” Timothy Geithner said in a statement.
Outgoing president Robert Zoellick added: “Jim has seen poverty and vulnerability first-hand, through his impressive work in developing countries.
“His rigorous, science-based drive for results will be invaluable for the World Bank Group as it modernizes to better serve client countries in overcoming poverty.”
US nominee Jim Yong Kim has been chosen as the new president of the World Bank
Andrew Mitchell, UK international development secretary and a governor of the World Bank Group, said that “as the first development professional to head the World Bank, Jim Yong Kim’s considerable experience will be vital as he leads it through its ambitious reform and modernization programme”.
Meanwhile, the bank hailed the selection process as competitive, saying that the challenge posed by Ngozi Okonjo-Iweala, as well as by Colombian candidate Jose Antonio Ocampi, would benefit the institution in the long run.
The three candidacies had “enriched the discussion of the role of the president and of the World Bank Group’s future direction”, the World Bank said.
By convention, the US has always held the top job at the World Bank since it was founded in 1944.
The top job of its sister organization, the International Monetary Fund, has also always gone to a European but there has been much pressure from emerging economies to open the processes of both organizations to competition.
This year’s vote was the first time the World Bank had to choose between candidates since its creation more than 60 years ago.
Dr. Jim Yong Kim will oversee a staff of 9,000 economists and development experts, and a loan portfolio that hit $258 billion last year.
Mark Weisbrot of the Center for Economic and Policy Research in Washington suggested Dr. Jim Yong Kim would make a very different kind of leader.
“There’s just no comparison between him and any of the prior World Bank presidents,” he said.
“The others were political insiders. They spent most of their lives getting rich or becoming politically powerful, or worse. Kim, by contrast, has spent most of his life trying to improve the lives of poor people.”