World Bank: Poorest Nations in Worst Financial Shape Since 2006

Facts

• A recent World Bank report has warned that the 26 poorest countries, which are home to 40% of the world’s poorest population, are currently facing their worst financial conditions since 2006.^[1][2]
• The organization says that these countries, many of which are in sub-Saharan Africa, are currently dealing with massive debt problems, conflicts, economic instability, and vulnerabilities to natural disasters.^[3]
• The report also detailed how, while the rest of the world has largely economically rebounded since the outbreak of COVID-19, many of these countries are even poorer now than they were before the pandemic, despite efforts to combat poverty in the nations.^[4]
• The report also highlighted that international aid has hit a 21-year-low, with countries contributing lower and lower percentages of their GDPs to aid developing nations. Due to this, the report argues, many poor countries have been forced to take out high interest loans.^[1]
• The bank is also seeking to raise $100 billion in funds to replenish its International Development Association, which has been supporting many financially struggling nations through near-zero interest loans and grants.^[5]
• The report additionally suggested that climate change is having an increasingly damaging effect on the economies of the poorest nations, with natural disasters resulting in an annual global average loss of 2% of economic output between 2011 and 2023.^[4][6]

Sources: ^[1]Reuters, ^[2]WION, ^[3]The Times of India, ^[4]Dw.Com, ^[5]Aljazeera and ^[6]The Japan Times.

Narratives

• Pro-establishment narrative, as provided by Brookings. Since its inception, the World Bank has played an instrumental role in global economic development. The investments from the bank play a crucial role in global infrastructure projects and some of its initiatives play critical roles in helping fragile and conflict stricken states. This essential work must continue.
• Establishment-critical narrative, as provided by Nature. The World Bank and its policies are not devoid of criticism and controversy. The banks loan policies work to contribute to a damaging cycle of loan dependency, in which recipient countries become continuously dependent on external financing. Additionally the bank's neoliberal principles are extremely Western-centric, contributing to this uneven power structure between the global south and the rest of the world.

Predictions