From October 9-15, the International Monetary Fund and World Bank Group are slated to hold their Annual Meetings in Marrakech, Morocco. Despite the recent devastation from an earthquake in Morocco on September 8, Moroccan officials and the IMF agreed to proceed with this year’s meetings as scheduled.

The Annual Meetings bring together central bankers, ministers of finance and development, academics, parliamentarians, and representatives from civil society organizations to discuss “issues of global concern.” More than 10,000 people typically attend the Annual and Spring Meetings of the IMF and World Bank, though this number has expanded due to hybrid attendance options since COVID-19, according to the IMF.

But what actually happens at the Annual Meetings? What topics get discussed? To get a clearer picture of the importance of the Annual Meetings between the World Bank and IMF, we asked SIS professor Randall Henning to answer a few of our questions. 

The International Monetary Fund and World Bank Group were created through the Bretton Woods Agreement in 1944. What are the roles of the World Bank Group and the IMF?

With respect to current roles, the IMF addresses balance of payments and financing needs, primarily of emerging markets and developing countries, as well as financial crisis and sovereign debt problems. The World Bank Group addresses economic development, poverty alleviation, and social and environmental protection, again, primarily in low-income but also middle-income countries. Their missions have evolved substantially from, but are still traceable to, the stated purposes of their original charters dating from 1944.

The World Bank Group and the International Monetary Fund have held annual meetings for decades. What is the history and purpose of these meetings?

The purpose of the annual meetings is to bring together the governors that sit on the Board of Governors of each institution to make important decisions that guide their work. Because some of the same national officials sit on the boards of both institutions, it is time and travel-efficient to hold the meetings back-to-back.

But the meetings take on a broader significance as a meeting place for the international financial and development communities, broadly defined, to discuss and debate the issues at hand, as well as an opportunity for officials to meet bilaterally and in plurilateral groups such as the G7, BRICS, and G20 forums. 

Each year, the Annual Meetings of the World Bank and IMF brings together central bankers, ministers of finance, parliamentarians, academics, and others to discuss major global issues. How significant are these annual meetings, and have we historically seen any major policy shifts come out of them?

During the global financial crisis of 2008-2009, for example, they addressed the need for stabilization, macroeconomic policy coordination, and financial regulation. During the European debt crisis of 2010-2015, they debated the appropriate financial support and policy conditions for Greece, for example. At the time of the COVID-19 pandemic, new facilities were mobilized to speed assistance to low-income countries, for example. So, yes, these meetings have been deeply consequential for the institutions and international crisis and development finance.

This year, the annual meetings are taking place in Morocco. What role do host countries play in the meeting? How are locations for the annual meetings selected?

The host countries typically have modest roles in the agenda of these meetings. Their ministers do not chair the meetings of the Board of Governors by virtue of hosting; that is done by others by agreement of the membership. Most annual meetings are held in Washington, DC, as our city serves as the headquarters for both. But every three years it rotates to another, though the rotation was interrupted by COVID-19. The last meeting held outside Washington was in Bali, Indonesia, in 2018. 

The theme for this year’s annual meetings is “Global Action, Global Impact.” Based on this theme, what kind of conversations and discussions do you anticipate coming out of this year’s meetings?

With respect to the agendas for this year's meetings in Marrakesh, the World Bank Group faces a critical juncture, where the United States and a number of other countries are proposing reforms to the institution and its companion multilateral development banks to address "global public goods.” By this, they largely mean global environmental problems, such as climate change, and public health issues such as pandemic prevention and response. Needless to say, there are debates about how this should be accomplished, and many low-income countries do not want the traditional project-finance role of the Bank to be relegated to global issues. 

The financial structure of the Bank is also under review, as many countries seek to channel more resources through it to ramp up the volume of lending, for both traditional purposes including infrastructure as well as, for example, climate change mitigation and adaptation. These matters are referred to within the Bank as the "Evolution" agenda.

The IMF also faces a set of decisions related to its own ability to mobilize resources, as it must decide whether to increase the quota contributions of its member states, and by how much. Whether it does so without changing the relative shares of members, such as the United States, European countries, and China, will be closely watched—because doing so would alter relative influence within the institution. The US position is that there should be no change at this point in the relative shares.

How the process of sovereign debt restructuring can be expedited confronts the IMF as well as the World Bank. The two Bretton Woods institutions influence these negotiations, for countries such as Ghana, Sri Lanka, and Ethiopia, but are ultimately reliant on other official and private creditors to deliver relief. This process has been proceeding too slowly, for which many blame Chinese official lenders. We expect some progress at Marrakech on measures to accelerate country-specific debt negotiations, but whether these are sufficient remains to be seen.*

Discussion of these subjects will take place against the background of sustained high interest rates, a global economic slowdown, and serious financial stress in China, among other places. 

*Editor’s Note: To learn more about possible policies and procedures related to sovereign debt restructuring, check out Professor Henning’s recently published policy brief titled “How to Make Sovereign Debt Restructuring Work Now” at this link.