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As vice-president and treasurer of the World Bank, he has a unique view: in the foreground the global and local bond markets, in the middle ground the vast needs of nations that are being damaged so badly by the pandemic and in the background the multilateral system, of which the World Bank is a driving force.
In this interview with GlobalCapital's Toby Fildes, Jingdong Hua admits that this is uncharted territory, but argues that multilateral banks have what it takes to help developing countries respond to the health, social, and economic impacts of Covid-19.
He also discusses how countries can be better prepared for the next pandemic and what role capital markets can play in that preparedness.
Heike Reichelt, head of investor relations and new products at the World Bank, also joined the interview.
GlobalCapital: You’ve worked in these markets for many years; what do you think of these past weeks of crisis?
Jingdong Hua, World Bank: In the past 26 years I have worked in five international organisations across several continents. So I’ve had my fair share of natural and man-made crises, and of course all the financial crises.
Every crisis is different, and therefore the response is different. Yet I have to say I have deeper appreciation for those folks in 1944, when they met in Bretton Woods in New Hampshire — they really deserve some credit.
We’re in uncharted territory. The European Central Bank is doing a lot of work, the Federal Reserve and the government here and in other OECD countries. Though under stress, they do have the financial means, both from central bank and government, to take care of citizens and the immediate response.
What about all those vulnerable countries that we have to deal with? In times of crisis, their access to finance from other sources is severely constrained. Many African countries in the last decade and a half have been able to go to euro or dollar markets and raise money. The cost may be high, but they at least felt confident they were building their reputations in the market. But when the crisis happened, their access stopped.
So it is in times of crisis that the value of multilateral banks really shines through. And I feel really...