World Bank to lower rates for large developing nations

According to a Wall Street Journal report, the World Bank will make considerable reductions to the interest rates it charges to larger developing countries such as China, Brazil, and Mexico, a move that the bank hasn’t undertaken in almost a decade. Under an arrangement to increase aid to impoverished countries, bank officials have confirmed that the institution will inject roughly $3.5 billion to the International Development Association (IDA). “The compromise was pushed hard by the World Bank’s new president, Robert Zoellick, who has emerged as a pragmatic horse trader, unsympathetic to conservative critics who say the bank should cut off lending to countries that can borrow easily on private markets,” said the report, further saying that “in exchange for lowering interest rates to pre-Asian-crisis levels, Zoellick pressed Brazil, Mexico, China and other middle-income countries to support a substantial contribution to the IDA by the International Finance Corporation.” (Source: World Bank eyes rate reduction for developing nations: WSJ/Agence-France Presse)

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