WASHINGTON--The World Bank has to change with the times in order to spur global development, according to Charles H. Dallara, managing director of the Institute of International Finance Inc., a commercial bank trade group.
At a press conference Tuesday, he said the World Bank should be offering commercial lenders guarantees against political risks in some parts of the world. This would encourage commercial banks to commit to longer-term financing in developing countries.
The World Bank and regional development banks also should encourage the worldwide trend toward privatization of government industries.
One way to do this would be for the World Bank to join private investors in some privatization deals without insisting on borrowing-government guarantees.
Mr. Dallara urged the lending body to reconsider its current policies. His group's suggestions do not require a charter change by the World Bank or threaten its AAA-rating, Mr. Dallara said.