Treasury Secretary Scott Bessent called for an overhaul of the IMF and the World Bank's mandate on Wednesday, but said the United States remains committed to maintaining its leadership role in global economic institutions.
Commentary In a speech about the interval between the IMF and the World Bank’s spring meetings, a time of concern among policymakers can withdraw the Trump administration from the U.S. from funds and banks entirely.
In recent months, the United States has upended the global trade system, and the Trump administration's perception of climate change, international development and economic equity is often contradicting shareholders in other countries.
On Tuesday, the International Monetary Fund lowered its global growth prospects as President Trump punished tariffs. Trade tensions between the world's largest economy, the United States and China, threaten output this year and the following year.
In his speech, Mr. Bessent defended the Trump administration's trade behavior and called on China to curb economic practices that he said were undermining international business stability. He noted that the United States held trade talks with dozens of countries and expressed optimism that these negotiations would help rebalance the world economy and make the global trade system more equitable.
It is not clear whether the United States and China will begin negotiations. Mr. Trump said he hopes to talk to Chinese leader Xi Jinping but has not arranged a formal dialogue.
Mr. Best spoke to reporters after he spoke to reporters, refuting Mr. Trump's speculation that he was considering unilaterally lowering his speculation that China imposed tariffs on China before negotiating with Xi Jinping. Mr. Bessent stressed that any move to downgrade trade tensions requires mutual reciprocity.
“I don't think the current tariff levels are sustainable,” he said.
“This is equivalent to an embargo, and the trade disruption between the two countries is not suitable for anyone's interest,” the finance minister added.
“If the United States does want to resolve the issue through dialogue and negotiation, it will stop threats and coercion and engage in dialogue with China based on equality, respect and mutual interests,” Guo Jiakun, spokesman for the Chinese Foreign Ministry, said overnight.
Mr. Bessent made it clear that despite U.S. concerns, the Trump administration does not intend to leave the IMF and the World Bank.
“'The United States first' does not mean one person,” Bessent said. “Instead, it is a call for deeper cooperation and mutual respect among trading partners.”
He added: “'The United States first' is far from recovering from a retreat, trying to expand the leadership of international institutions such as the IMF and the World Bank.”
However, the Finance Minister did not stop his criticism of the institutions, which were created in 1944 to stabilize the world economy after World War II.
“The IMF has suffered from mission creep,” Mr. Bessent said in a speech to the International Finance Institute. “The IMF was once unwavering in its mission to promote global monetary cooperation and financial stability. Now it is committed to disproportionate time and resources to work on climate change, gender and social issues.”
Mr. Bessent believes that its focus has obscured its economic mission, adding: “These issues are not the IMF's mission.”
The Treasury Secretary has also received tough criticism of the World Bank, which, under the Biden administration, will focus on combating climate change.
“Banks should no longer expect vapid, buzzword-centric marketing to do blank checks, accompanied by half the commitment to reform,” Mr Bessent said. “As the bank returns to its core mission, it must use its resources as efficiently as possible. It must do this in a way that demonstrates the tangible value of all member states.”
Mr. Bessent, under Ajay Banga, did appreciate the bank's plan to consider ending its restrictions on loans to nuclear energy projects. He said the bank should be “technologically neutral” and prioritizes affordability for energy investment.
“In most cases, this means investing in natural gas and other fossil-based energy production,” Mr. Bessent said. “In other cases, this may mean investing in renewable energy, as well as systems to help manage the intermittent nature of wind and solar energy.”
Mr. Banga tried to highlight the bank's focus on job creation, which is key to economic development and prioritizes private sector participation in projects around the world.
Last week, Banga said he continued to hold talks with the Trump administration on the direction of the bank.
“We are having a constructive conversation with the U.S. government,” Benga said. “I don’t know where it will end, but I have no problem with my conversation.”
He added: “They ask the right questions and we try to give them the right answers.”
