World Bank chief warns US default threat hurts poorest

Washington: World Bank President Jim Yong Kim on Wednesday said even the threat of a US default could hurt emerging markets and the world’s most vulnerable people.

“We’re very concerned. Because right now there’s so many headwinds as it is for emerging markets and the developing world, that that kind of impact really could be devastating,” Jim said in an interview with CNN broadcast live at the World Bank, the Washington-based poverty-fighting institution.[caption id=“attachment_1162855” align=“alignleft” width=“380”]  World Bank President Jim Yong Kim. Reuters[/caption]

He pointed to the persistent market impact from the last time the United States approached defaulting on its debt, in August 2011, when markets in developing countries dropped. Falling markets hurt not only large corporations, but also small business owners and farmers around the world, he said.

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Jim also said the World Bank plans to halve extreme poverty by 2020, an interim goal as the bank seeks to fulfill its poverty-fighting targets.

Jim in April called on the international community to reduce the number of people living on $1.25 a day to 3 percent by 2030, and also raise the incomes of the poorest 40 percent of the people in every developing country.

Right now, 18 percent of the world’s people are in extreme poverty, and Jim said this must fall to 9 percent in the next seven years in order to fulfill the more ambitious goal by 2030.

Reuters