Developing countries should strike swift trade deals with the United States at the “earliest possible” opportunity, the president of the World Bank said, after a busy week with global financial leaders in Washington.
Ajay Banga was interviewed by AFP at the World Bank and International Monetary Fund’s Spring Meetings, which were held this year amid uncertainty about President Donald Trump’s stop-start tariff rollout.
Banga said the Bank has been advising developing countries to quickly complete a deal with the United States and then focus attention on cutting trade barriers and boosting regional flows of goods.
“You need to negotiate trade systems with the US at the earliest possible (opportunity),” he said. “If you delay, it hurts everyone.”
Department of Economy, Planning and Development (DepDEV) Secretary Arsenio Balisacan said that addressing risks and reinforcing economic resilience remain the government’s top priorities to ensure that the country is on the path to sustainable development.
Balisacan said that while the Philippines is one of the fastest-growing among emerging and middle-income economies, the government is aware of the uncertainties in the global economy.
“Barring major external shocks, and assuming a favorable global trade environment, we are well-positioned to achieve upper-middle-income status by 2026,” Balisacan said.
“Nonetheless, we remain acutely aware of the uncertainties that confront the global economy — ranging from systemic risks in economic institutions and technological disruption to environmental challenges,” he added.
To sustain and accelerate the country’s progress, Balisacan said the country must mainstream efficient green transitions, foster resilience, and harness innovation as new frontiers for growth.
“In the Philippines, we aim to realize these goals through targeted investments, strengthened national institutions, workforce upskilling and reskilling, climate and biodiversity resilience integration, and the revitalization of partnerships, particularly through South-South and technical cooperation,” he said.
Balisacan said the government must also ensure that development benefits reach all segments of society.
Last year, the Philippine economy grew by 5.7 percent.
The Development Budget Coordination Committee earlier set a 6 percent to 8 percent economic growth target for 2025 and 2026 but Trump’s tariffs have roiled financial markets, sent volatility surging and spooked investors and consumers.
Since returning to office in January, the US leader has imposed a “baseline” 10 percent tariff on most countries, with much higher duties on China, and 25 percent sector-specific levies on areas including steel, aluminum, and automobiles not manufactured in the United States.
He also introduced much higher tariffs on dozens of countries, which have since been temporarily paused, accusing them of having an unfair trade balance with the United States.
Banga also addressed the criticism leveled by US Treasury Secretary Scott Bessent at the Bank earlier this week.
Bessent criticized China’s “absurd” developing country status and called on Banga and IMF Managing Director Kristalina Georgieva to “earn the confidence of the administration.”
“I don’t think he’s wrong,” Banga said of Bessent’s comments on China.
“A country that is the size of China and the capability of China, at some point, should no longer be taking money from IBRD,” he said, referring to the International Bank for Reconstruction and Development — an arm of the World Bank that lends largely to middle-income countries.
Such a move would require the support of the World Bank’s executive board, which is made up of member states.
Banga said China borrowed around $750 million from the IBRD last year and paid billions of dollars in repayments and donations to the institution.
“My view is, I’ve brought it down to 750 (million), and I’m trying to figure out a way to deal with China to bring it down further,” he said. “I want to get it done. And that’s what I’m talking to the Chinese about.”
Banga said the Trump administration’s criticisms of the World Bank, which included “expansive policy overreach,” were not unusual, citing newly elected governments in countries including France, Japan and Korea.
“I keep telling people this is a perfectly constructive request, to say, tell me and show me that you guys are the kind of people that advance the interests of my taxpayer, of my country,” he said.
“I take it in that spirit,” he said. “There’s nothing wrong with it.”
Since taking the helm of the Washington-based development lender in 2023, Banga has pushed to streamline operations and encourage private sector participation, focusing on job creation and electricity connectivity.
Among the Bank’s current priorities is a push with the African Development Bank to connect 300 million people in sub-Saharan Africa to electricity by 2030 — a process that will require a vast amount of new energy to be brought online.