The World Bank will phase out lending to China by 2031 after years of declining lending, reflecting the country's rise to the world's second-largest economy, Reuters reported, citing sources.
The World Bank's board of directors will consider the plan in the week beginning July 20, although no formal vote is required, one of the sources said. The decision was agreed between the World Bank and China as part of a five-year “country partnership framework.” The change, first reported by the Financial Times, will cap Beijing’s lending to the multilateral development bank at $2 billion between now and 2031, after which it will cease. World Bank lending to China has been in steady decline, falling from $2.4 billion a year in 2017 to $750 billion in 2025. The United States and other countries have long urged the World Bank to halt lending to China given the strength of the Chinese economy. The World Bank made a similar move in June for Poland, halting development loans to the country after 2031. year.
A US Treasury spokesman described the move as a “step in the right direction“ and said Washington looked forward to other institutions following suit.
“As the world's second-largest economy, China should not be receiving aid from multilateral institutions,“ the spokesman said.