In light of President-elect Donald Trump‘s commitment to trim U.S. government expenditures, the World Bank, currently under investigation for the misplacement of $24 billion in climate funds, is bracing for substantial budget reductions.
What Happened: Senior officials at the World Bank are expressing concern following Trump’s election win. The Washington-based financial institution, criticized for functioning like a bureaucratic slush fund despite its mission to fight poverty and climate change, is wary of the incoming administration’s fiscal austerity.
According to a report by the New York Post, Elon Musk and Vivek Ramaswamy are poised to head a White House advisory body, the Department of Government Efficiency (DOGE), which could single out the World Bank for budgetary cutbacks.
An anonymous staffer told the outlet, “They have been running around like headless chickens since Trump won.”
One potential area for cost reduction is the World Bank’s lavish spending on air travel, which allows unelected officials to upgrade to business class for flights longer than five hours.
Leaked documents show nearly $9,000 was spent on a round-trip business class ticket with a private suite from Washington Dulles airport to Baku, Azerbaijan.
Also Read: Here’s How Trump’s Policies Might Shape The Market’s Future
During Trump’s previous term, World Bank officials made attempts to maintain a good relationship with the President, often inviting his daughter and then-advisor Ivanka Trump to speak at their conferences.
However, following Trump’s victory over Kamala Harris, there is “lots of anxiety” within the global organization, a second World Bank source told The Post.
According to a World Bank spokesperson, a productivity savings initiative was launched last year, requiring each vice presidency to reduce its budget by 5% annually from less essential expenses.
Ajay Banga, the Biden-nominated head of the World Bank, has set the lender “on a fast course to become better and more effective.”
Why It Matters: The World Bank’s anticipated budget cuts come at a time when the institution is already under scrutiny for mismanagement of funds.
The potential cutbacks, coupled with the existing investigation, could significantly impact the World Bank’s ability to fulfill its mandate of combating poverty and climate change.
The appointment of Musk and Ramaswamy to lead the DOGE could further intensify the scrutiny on the World Bank’s spending.
Read Next
Trump Aims To Make US ‘Crypto Capital Of The Planet’: ‘We’ll Get It Done’
This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.
Photo: Wikimedia Commons
Market News and Data brought to you by Benzinga APIs
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
