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David Malpass' advice to World Bank successor: time is short
In his final interview as president of the World Bank Group, David Malpass spoke with Ian Bremmer on GZERO World to reflect on his time leading the global development organization and to share his advice for his successor, Ajay Banga.
Malpass became president of the World Bank in 2019 and has seen the world change significantly during his term. He says he’s proud of how the bank handled major global challenges like the COVID-19 pandemic, the war in Ukraine, and the Afghanistan evacuation. He also thinks the bank did a good job raising the alarm about an impending economic crisis: slow growth and skyrocketing global debt.
“We had a core vision that we want people in developing countries to have better lives tomorrow than today,” Malpass says.
When it comes to the insight he’d offer to the next World Bank president, Malpass has three simple words of advice: time is short.
Malpass stresses that now is the moment to really rethink fiscal and monetary policy to create a more equitable global economy, one where all the capital isn’t flowing to a centralized point. According to Malpass, part of the job of the World Bank president is to have tough conversations about the major challenges in the world, like debt and climate, to get advanced economies to take action.
“Who’s going to stand up to the advanced economies and say, ‘You’re taking all the money so there’s not enough left for the rest of the 6 billion people in the world?’”
Watch the episode of GZERO World with Ian Bremmer: World Bank's David Malpass on global debt & economic inequality
Debt limits of rich countries hurt poor countries' growth, says World Bank's Malpass
Does the global financial system need a major overhaul?
In his final interview on GZERO World as president of the World Bank Group, David Malpass discusses a serious problem with host Ian Bremmer: the consolidation of economic and political power in the hands of the wealthiest countries. The world is facing a massive debt crisis––60% of low-income countries are now in debt distress or dangerously close to it. The poorest countries are paying an average of 16% of revenue on servicing loans.
Decades of low interest rates and cheap goods, followed by the pandemic and runaway inflation led countries to borrow huge sums of money. But it didn’t happen in an equitable way. Wealthy nations like the US and the European Union pumped trillions into their economies to keep them afloat. But poor nations kept borrowing money they couldn’t afford to pay back.
“The poorer countries are not catching up, and we really want a world where the people in lower income levels actually get to grow faster,” Malpass tells Ian Bremmer. “That’s what creates stability."
Malpass says that the goal of the World Bank, and any value-based society, is faster growth in poorer countries so they can catch up with advanced economies and stabilize. And that means integrating the economies of developing countries better with the West, which can at odds with nationalist economic policies like “Buy America,” near-shoring, and inshoring.
“I think there’s plenty of room in a logical world to say we don’t want dependency,” Malpass stresses, “But we also want to have a vibrant, global marketplace that is competitive. And the US needs to lead and be the starting point for a lot of this rethinking of the global system.”
Watch the episode of GZERO World with Ian Bremmer: World Bank's David Malpass on global debt & economic inequality
- Ian Explains: The debt ceiling ›
- Podcast: Fix the global debt crisis before it's too late, warns World Bank's David Malpass ›
- World Bank's David Malpass on global debt & economic inequality ›
- US debt default would be "destabilizing," says World Bank's David Malpass ›
- Odds of a global recession? 50/50, says David Malpass ›
- World Bank economist: The poorest are getting poorer globally - GZERO Media ›
- How to tackle global challenges: The IMF & World Bank blueprint - GZERO Media ›
- Hot topics at the IMF-World Bank meetings - GZERO Media ›
World Bank's David Malpass on global debt & economic inequality
The world has a huge debt problem. Economic growth is slowing, but global debt is skyrocketing.
David Malpass sits down with Ian Bremmer on GZERO World for his final interview as president of the World Bank Group to discuss the debt crisis, his tenure at the World Bank, and solutions for combatting growing economic inequality.
Global debt has ballooned in the last two decades to an eye-watering $300 trillion due to years of low interest rates and cheap goods that made money easy to borrow. Then, along came the pandemic which stalled growth and a war in Ukraine that shot up food and energy prices, leading to runaway global inflation.
Rich countries reacted by injecting trillions of dollars of stimulus money into their economies, borrowing huge sums in order to do so.
"So much more of the world's capital is going just to pay off the debt of the advanced economies," Malpass warns, "That leaves less for everybody else, and I think that's a grave concern."
Malpass also spoke about China's emergence in the 21st century as the world's creditor, his proudest accomplishments as World Bank president, and advice for his successor, Ajay Banga. He also points to countries like India and Indonesia, which he believes are poised for significant economic expansion.
Can the world solve the global debt crisis before it's too late? Watch this full interview with David Malpass on GZERO World with Ian Bremmer.
- World faces "lost decade" of economic growth, says World Bank economist ›
- Graphic Truth: Global inequality ›
- US debt default would be "destabilizing," says World Bank's David Malpass ›
- Debt ceiling crisis: A default by any other name... ›
- Staving off default: How unsustainable debt is threatening human progress ›
- Is the global debt apocalypse here? ›
- Debt limits of rich countries hurt poor countries' growth, says World Bank's Malpass - GZERO Media ›
- Ian Explains: Why is global debt so high? - GZERO Media ›
- World Bank economist: The poorest are getting poorer globally - GZERO Media ›
Podcast: Fix the global debt crisis before it's too late, warns World Bank's David Malpass
Listen: In his final interview as World Bank president, David Malpass sits down with Ian Bremmer on the GZERO World podcast to discuss all things debt. No, not your credit card or mortgage payments, but the sovereign debt that governments use to pay their bills.
Global debt has ballooned to an eye-watering $300 trillion due to decades of low interest that made borrowing money extremely cheap, followed by runaway inflation driven by the pandemic and war in Ukraine. This dynamic has forced a lot of nations––particularly the poorest––to borrow more money than it can pay back.
In a wide-ranging interview, Malpass explains how the global debt crisis got so bad and whether there's any hope of averting economic disaster before it's too late. He also reflects on his tenure as World Bank president, advice for his successor, China's emergence in the 21st century as the world's creditor, and why the US debt limit law needs to be rewritten.
Subscribe to the GZERO World Podcast on Apple Podcasts, Spotify, Stitcher, or your preferred podcast platform, to receive new episodes as soon as they're published.- Odds of a global recession? 50/50, says David Malpass ›
- Explaining the long history of US debt (& which other countries are saddled with debt) ›
- US debt default would be "destabilizing," says World Bank's David Malpass ›
- World faces "lost decade" of economic growth, says World Bank economist ›
- Inequality isn't inevitable - if global communities cooperate ›
- Graphic Truth: Global inequality ›
- Debt limits of rich countries hurt poor countries' growth, says World Bank's Malpass - GZERO Media ›
- Ian Explains: Why is global debt so high? - GZERO Media ›
- World Bank economist: The poorest are getting poorer globally - GZERO Media ›
Will the US default on its debt? Ask GZERO World's guests
It's the question swirling around Washington this week (and last week, and the week before, etc, etc). It's of concern to US allies and of great interest to US adversaries: Will the United States government default on its debt for the first time in history? Depending on the day of the week, or the hour of the day, you may get a different answer from politicians and pundits alike.
On GZERO World with Ian Bremmer, though, guests from the past few months, including Utah Senator Mitt Romney, World Bank Group President David Malpass, former New Jersey Governor Chris Christie, and US Transportation Secretary Pete Buttigieg, have struck a common chord: it won't happen, but if it does, we're in for a hurting. Catch GZERO World with Ian Bremmer on public television stations nationwide. Check local listings.
- US debt default would be "destabilizing," says World Bank's David Malpass ›
- Sen. Mitt Romney on DC dysfunction, Russian attacks, and banning TikTok ›
- Pete Buttigieg explains: How the debt limit impacts transportation ›
- Chris Christie weighs in on US debt limit fight ›
- US debt limit: default unlikely, dysfunction probable ›
US debt default would be "destabilizing," says World Bank's David Malpass
The debate in the US Congress around the debt limit and a potential default is like spending money on a credit card but refusing to pay the bill, according to David Malpass, outgoing president of The World Bank Group.
On GZERO World with Ian Bremmer, Malpass discussed the ongoing negotiations in Washington to avert a default and raise the debt ceiling before the federal government runs out of money on June 1. If the two sides can’t come to an agreement, Malpass says, the economic consequences will be “destabilizing.”
As a global financial leader, Malpass believes the US should consider rewriting the law so there’s no threat of default and adds that putting pressure on lawmakers might be the most effective way to get Congress to take action.
“If you’re over the debt to GDP limit, don’t pay salaries to senior government workers, to congressmen,” Malpass argues.
In this clip, learn why Malpass thinks Congress will come to a last-minute agreement and why minting a trillion-dollar coin to solve the problem is a very bad idea.
Watch the full episode of GZERO World with Ian Bremmer on PBS airing soon on US public television. Check local listings.
- Debt ceiling deal: long way to go in little time ›
- Pete Buttigieg explains: How the debt limit impacts transportation ›
- Chris Christie weighs in on US debt limit fight ›
- US debt limit: default unlikely, dysfunction probable ›
- Will the US default on its debt? Ask GZERO World's guests - GZERO Media ›
- Debt limits of rich countries hurt poor countries' growth, says World Bank's Malpass - GZERO Media ›
- Podcast: Fix the global debt crisis before it's too late, warns World Bank's David Malpass - GZERO Media ›
Human rights activists demand the safe return of Ricardo Lagunes and Antonio Díaz, community defenders who disappeared on January 15. Mexico City, Mexico, January 22, 2023.
Hard Numbers: Environmentalists targeted, World Bank outlook improves, mass shooting in Louisville, fiery cocktails in Northern Ireland, Winnie-the-Pooh gets punched
24: This year alone, at least two dozen environmental activists have already been murdered or disappeared in Mexico and Central America, according to an investigation by The Guardian. Many are from indigenous communities protesting against mining activities on their traditional lands.
2: Outgoing World Bank President David Malpass revised the international lender’s 2023 global growth outlook on Monday, bumping it from 1.7% to 2%. He credited China’s improved economic trajectory for the change. Malpass, who plans to step down in June, kicked off his final World Bank/IMF Spring Meetings with the news.
145: The mass shooting at a bank in Louisville, Kentucky, on Monday was at least the 145th incident of its kind in the United States since the start of this year, according to the Gun Violence Archive. Five people – including a close friend of the state governor – were killed and nine injured when a disgruntled bank employee opened fire.
4: On the eve of President Biden’s trip to Northern Ireland to celebrate the 25th anniversary of the Good Friday Agreement, at least four men were spotted hurling petrol bombs at police. The incident occurred during a parade organized by people who oppose the agreement, which ended decades of conflict between Irish nationalists and the British government. For more on the contentious history, read our primer here.
300: A wildly popular new patch worn by Taiwanese fighter pilots shows a native Formosan black bear punching Winnie-the-Pooh – a common satirical stand-in for Chinese president Xi Jinping – in the face. The patch has been around for a year, but orders blew up this weekend after China conducted its mock invasion of Taiwan. A little e-commerce research shows that you too can own one of these patches for a mere 300 NT$ (about US $9.60).
World Bank Group President David Malpass speaks to the media in Washington, D.C. in 2022.
Hard Numbers: World Bank chief resigns, Another Russian journalist jailed, Ukraine’s humanitarian needs, pessimistic Nigerians, good riddance Johns Hopkins tracker
12: World Bank President David Malpass, tapped by former President Donald Trump, announced Wednesday that he’ll step down this summer, roughly 12 months before his term expires. Malpass has been mired in controversy in recent months after he refused to say whether fossil fuels are warming the planet. (Malpass spoke to GZERO Media amid the controversy, saying he’s not a climate change denier.)
6: Russian journalist Maria Ponomarenko has been handed a six-year jail sentence for posting on social media that Russian planes were responsible for an attack last March on Ukrainian civilians hiding in a theater in Mariupol. Following the verdict, Ponomarenko, a mother of two, said: “No totalitarian regime has ever been as strong as before its collapse."
5.6 billion: The UN said Wednesday that $5.6 billion is needed to provide humanitarian aid to the tens of millions of Ukrainians impacted by the war, including around 4 million who have resettled in Eastern Europe. But with the situation in Turkey and Syria continuing to deteriorate, Ukraine fundraisers could now have a tougher time securing Western aid dollars.
90: Ahead of general elections on Feb. 25, a whopping 90% of Nigerians say that the country is headed in the wrong direction, the worst outlook ever recorded. For a look at what’s at stake in the election, see this primer.
3: After more than three years in action, the Johns Hopkins University COVID-19 tracker will stop updating its data on March 10. The dashboard started publishing global pandemic statistics in Jan. 2020 and has been viewed more than 2.5 billion times since. We won’t miss you, Johns Hopkins tracker.