World Bank President Says Interest Rates Will Remain Higher For Longer

Ajay Banga, the President of the World Bank, stated that companies across the world could face complications in their investments as interest rates are expected to remain high for a prolonged period of time.

He emphasized that central banks are facing a challenging task in steering their economies towards a soft landing during times of war, according to a report by Reuters.

Furthermore, while China has been working with the development lender, Banga believes that there should be more transparency regarding debt contracts, which would help speed up the process of debt restructurings for poor countries.

He suggested that countries should first try to restructure the debts of struggling poor countries by utilizing existing tools before considering replacing them.

Earlier on 9 October, Banga came under pressure from development advocates to focus on the financing of climate transition, which is estimated to be around $3 trillion for emerging market and low-income economies by 2030.

The World Bank chief was present at the IMF-World Bank annual meetings that are being held in Marrakech, Morocco. Speaking on the sidelines of the event, Banga also called the Israel-Gaza conflict "a humanitarian tragedy and... an economic shock we don't need".

Banga who is only 130 days into the job as World Bank Chief, however, has said that the most important step from the meetings will be a long-awaited shareholder endorsement of changing World Bank’s anti-poverty mission statement.

The measure to add 'on a livable planet' has been in the process for a year now. The development community is waiting for the next move so as to maintain momentum and scale up financing for climate quickly.

Banga has headed the International Chamber of Commerce, and Mastercard before becoming President at the World Bank.