IMF creeping on World Bank territory

TENGKU BAHAR/AFP/Getty A new study has concluded that the International Monetary Fund has been encroaching on the World Bank’s job. The joint IMF/World Bank report was conducted by current and former finance ministers from Germany, Brazil, Nigeria and Indonesia. Instead of horning in on World Bank turf through activities such as providing loans to poor ...

TENGKU BAHAR/AFP/Getty

TENGKU BAHAR/AFP/Getty

A new study has concluded that the International Monetary Fund has been encroaching on the World Bank’s job. The joint IMF/World Bank report was conducted by current and former finance ministers from Germany, Brazil, Nigeria and Indonesia. Instead of horning in on World Bank turf through activities such as providing loans to poor countries, the authors found, the IMF should stick to what it does best: Ensuring that the global economy runs smoothly.

Fine with us, said IMF Managing Director Rodrigo de Rato at Tuesday’s press conference with World Bank President Paul Wolfowitz. The World Bank and IMF vow to coordinate and collaborate more effectively. Yet it remains to be seen how this will work in practice. True, the organizations have different mandates—the IMF‘s mission is to oversee global financial stability, while the World Bank focuses on reducing poverty. But in practical terms, these are two sides of the same coin, so a little tug-of-war between the two institutions is probably inevitable. Don’t expect Rato and Wolfowitz to be holding hands and singing “Kumbaya” together for long.

Prerna Mankad is a researcher at Foreign Policy.

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