A handout photo made available by the Indian Press Information Bureau (PIB) shows Indian Prime Minister Narendra Modi (R) welcoming US President Joe Biden for the G20 Summit at Bharat Mandapam at ITPO Convention Centre Pragati Maidan in New Delhi, India, 09 September 2023. EFE/EPA/INDIAN PRESS INFORMATION BUREAU / HANDOUT HANDOUT EDITORIAL USE ONLY/NO SALES

Biden advocates World Bank offer alternatives to Chinese loans

New Delhi, Sep 9 (EFE).– US President Joe Biden urged G20 leaders on Saturday to expand the lending capacity of the World Bank (WB) with the aim of offering developing economies an alternative to China’s loans.

A large screen placed at International media centre shows US President Joe Biden arriving to attend the G20 Heads of State and Government Summit at the ITPO Convention Centre, Pragati Maidan in New Delhi, India, 09 September 2023. EFE/EPA/RAJAT GUPTA

Biden’s calls came during the second session of the G20 summit, currently underway in New Delhi, the White House said in a statement.

During the session titled “One Family”, which was held behind closed doors, Biden urged G20 members to turn the World Bank into a “a stronger institution that is able to provide resources at the scale and speed needed to tackle global challenges and address the urgent needs of the poorest countries.”

According to the White House, Biden’s proposal seeks to demonstrate to the so-called “Global South” that the G20 is capable of presenting solutions to their problems.

Besides promoting a reform of the World Bank, Biden spoke of modernizing the International Monetary Fund (IMF) so that it can better respond to the needs of emerging economies.

The US proposal comes at a time when China, through bilateral agreements, has become the main creditor of many emerging countries, some mired in severe economic crises due, in part, to Beijing’s unwillingness to restructure its debts.

To turn the WB and IMF back into the main creditors of the “Global South,” Washington wants these credit agencies to be able to offer more loans and G20 countries to commit to increasing their financing capacity by $200 billion over the next decade.

The US believes it is in a good position to initiate these reforms as it is the largest shareholder in the WB and the IMF.

Moreover, Ajay Banga, an Indian-American who aims to combat poverty and climate change, was elected President of the World Bank this year.

While the White House has emphasized that these reforms are not directed against China, it has acknowledged that it seeks to offer alternatives to its “coercive” loans through China’s Belt and Road Initiative (BRI) for global infrastructure development and connectivity.

The BRI was launched 10 years ago by Chinese President Xi Jinping, under which Beijing has financed infrastructure projects and provided loans to developing countries, resulting in the expansion of China’s geopolitical and economic power across five continents.

Meanwhile, Chinese Premier Li Qiang, who is attending the G20 summit in place of Xi, spoke of the need for “unity” instead of division, “cooperation” instead of “confrontation” and “inclusion” in place of “exclusion.”

China has offered no explanation for the absence of its president, which many experts have interpreted as an attempt to downplay G20’s influence in favor of other groups where it enjoys more influence, such as BRICS.

At the summit, Biden seeks to demonstrate that the G20 remains central to the global economy and geopolitics, despite Xi’s absence. EFE