WASHINGTON, Sept 21: World Bank President Robert Zoellick wants the poverty-fighting institution to be more useful to the world’s maturing economies, a diverse group that includes economic powerhouses like China.

While a formal strategy for working with middle-income countries is being refined, Zoellick is pushing to simplify and reduce the pricing of World Bank loans, which were last adjusted at the height of the Asian financial crisis in 1998.

“I think a strong partnership with our middle-income clients is vital for the bank’s future and the future of the multilateral economic system,” Zoellick said in an interview this week with Reuters. “We need to support them.” These middle income countries have been recipients of massive private capital flows as their economies flourished.

They have also increasingly moved outside the bank for funding even when commercial terms are more expensive, in part, because they want to signal to markets they are no longer aid-dependent.

As a group of roughly 80 states, these countries are growing faster than the world’s industrialised nations, adding to debate that the World Bank should cease lending to them.

But Zoellick is not of the school that believes the bank should focus on Africa rather than emerging market countries.

“There are lessons we can learn from their experiences as well as things we can help with,” he said.Zoellick’s reasons to stay engaged in middle-income states are three-fold: they are home to 70 per cent of the world’s poor; despite high growth reforms in those countries can be slowed by a lack of political support; and their growing global clout potentially makes middle income countries key players in other developing countries.

“I think there is a very full and rich agenda with middle-income countries, and if we were to be a global multilateral institution, part of our challenge is to connect the bottom billion with the middle-income and developed countries,” he added.

A recent report concluded that the World Bank was still relevant to middle-income countries but it could no longer be business as usual.—Reuters