The World Bank has announced plans to phase out its lending to China by 2031. This decision is part of a new country partnership framework that reflects China's significant development progress over recent decades. A source familiar with the matter confirmed the development to AFP, following an earlier report by the Financial Times.
Shift in Relationship
A World Bank official, speaking on condition of anonymity, noted that China has made remarkable development strides with support from the World Bank and other entities. 'Now we are reaching a new phase of our relationship, reflecting that reality,' the official said. The World Bank's role is transitioning from a lender to a knowledge partner, aligning with China's evolving development trajectory.
Declining Lending
World Bank lending to China, the world's second-largest economy, has been on a steady decline. It peaked at $2.42 billion in 2017 but fell to $750 million in 2025. This reduction mirrors China's explosive economic growth and improvements in poverty indicators.
US Influence
The decision to reduce lending also comes amid demands from US President Donald Trump, who called for an end to World Bank loans to China during his first term. Although Trump has not specifically repeated this demand in his second term, his aggressive stance towards China has influenced global financial institutions.
China's Contributions
Despite the phase-out of lending, China remains a significant contributor to the World Bank's International Development Association (IDA) pool, which supports the world's least developed countries. China's $1.5 billion contribution under the latest replenishment round makes it the fifth-largest donor.
Similar Moves
On June 16, the World Bank announced a similar plan for Poland, aiming to reduce loans to zero by 2031 while maintaining technical assistance. This indicates a broader strategy by the World Bank to adjust its lending practices based on countries' development needs and economic status.
