World Bank chief steps down amid ongoing criticism

David Malpass. Archival

World Bank President David Malpass announced that he will step down on June 30, despite extending his term until April 2024, ending his fourth year amid continued criticism from US Treasury Secretary Janet Yellen and White House climate adviser John Kerry over Malpass's level of commitment to action to slow climate change.

It was not immediately clear who would replace Malpass at the World Bank, which lends billions of dollars to developing countries.

Malpass, who was appointed by former US President Donald Trump, sought to increase economic growth, alleviate poverty, improve living standards and reduce government debt burdens, according to a statement from the bank.

But the World Bank, which more than doubled its climate financing for developing countries to a record $32 billion last year, has failed to finance climate-related projects to the extent that President Joe Biden's administration had hoped.

With Congress unwilling to help Biden meet his commitments to help developing countries with climate aid, the White House has increasingly turned to global financial institutions to help reduce greenhouse gas emissions.

The World Bank said it had set a climate finance target of 35 percent of its total loans, worth $25 billion a year on average over five years, a figure many government officials and climate activists say is too low.

Yellen praised Malpass's post, noting his support for Ukraine, his assistance to the Afghan people, his commitment to reducing the debt of poor countries, and crediting him with regular reports that help countries "prioritize actions that reduce greenhouse gas emissions."

The World Bank spent about $15 billion on fossil-fuel-related projects from 2016 to 2021, including a $200 million loan guarantee in 2021 for a gas-fired power plant in Uzbekistan.

The bank also financed the $1.6 billion Epidemic Fund and gave $19 billion to Ukraine in its war with Russia.

Before heading the World Bank, Malpass held positions under Presidents Reagan, Bush Sr. and Trump, as well as chief economist at investment bank Pierre Stearns, as well as joining the Trump campaign as an economic adviser.