On October 18, 2025, the US Treasury Secretary Scott Bessent has explicitly called on the International Monetary Fund (IMF) and the World Bank to adopt a tougher stance on economic behaviors led by Communist-led countries. He also emphasized the need for global lending institutions to refocus on their core missions.
In a statement released on October 15, the US Treasury Department conveyed Bessent’s message to the Development Committee of the World Bank and the International Monetary and Financial Committee of the IMF. The statement highlighted that the IMF should strengthen its national oversight activities in an “objective and impartial” manner. The Treasury Secretary also urged the World Bank to terminate its support for Communist-led China and redirect resources to countries in greater need of assistance.
Bessent stated in the declaration, “The IMF should not shy away from raising sharp questions, need to have a clearer understanding of internal and external imbalances, deepen the understanding of how industrial policies of large economies such as (Communist) China exacerbate these imbalances, explain their potential harmful spillover effects, and propose appropriate corrective measures.”
The US and Western countries have long criticized Communist industrial policies for contributing to overcapacity, exacerbating domestic deflation and price wars in China, as well as causing an influx of cheap goods globally, intensifying trade imbalances.
Bessent first urged the IMF and World Bank to enhance scrutiny of Communist China in April this year, but his latest statement provides a more detailed explanation of the issue. He called for the IMF to intensify its oversight of imbalances, including those in (Communist) China, in the forthcoming comprehensive review of supervisory policies, last updated in 2021.
The statement expressed the US’s expectation that the IMF’s upcoming comprehensive review would help achieve these goals in the future. Bessent further insisted that the IMF’s focus should be on macroeconomic and financial stability, rather than areas outside its professional knowledge, such as climate and gender issues.
Bessent subtly mentioned China, criticizing the IMF for allowing stubborn creditors to escape responsibility too easily in debt restructuring negotiations with developing countries burdened by debt. Beijing, as the world’s largest bilateral lender, has insisted that multilateral development banks also share losses, delaying debt restructuring for countries like Chad, Zambia, and Sri Lanka.
Without directly naming China, Bessent pointed out that these circumstances exacerbate liquidity risks and economic pressures for debt-ridden countries.
“In this situation, if creditor countries intensify the pressure of liquidity risks that the IMF plans to address, then the IMF’s plans will not be effective,” Bessent remarked.
“Furthermore, the IMF’s resources must not be seen as a savings account to repay creditors who made bad gambles but refuse to accept losses,” emphasized the US Treasury Secretary.
Bessent also highlighted that corruption and criminal activities continue to hinder some of the IMF’s reform efforts. Loan projects should be based on firm commitments to governance, anti-corruption, and effective safeguards to help ensure lasting reforms can catalyze enduring private-sector-led growth.
Regarding the World Bank, Bessent stated in his declaration that the institution must pay more attention to implementing its “graduation” policy, supporting countries in becoming self-reliant, and enabling the World Bank to concentrate resources on the most needy and significantly affected poorest and credit-challenged countries.
“This must include ceasing support for (Communist) China and reallocating staff and administrative resources to countries with the most urgent development needs,” the US Treasury Secretary singled out China.
Bessent also targeted Communist-led companies in the World Bank’s project procurement activities, urging the institution to “curb anti-competitive procurement practices of state-owned enterprises” and prohibit entities that operate “not on a commercial basis” from participating in procurement.
Aligned with the Trump administration’s opposition to green energy subsidy policies, Bessent further suggested that the World Bank should revoke its commitment to allocate 45% of annual financing to climate-related projects by 2023 and advocate for a “comprehensive” energy financing model for natural gas, oil, and coal.
As China weaponizes critical minerals such as rare earths, disrupting global supply chains, Bessent called for increased financing from the World Bank in this area in his statement.
Hinting at China’s control over the rare earths supply chain, Bessent emphasized the importance of critical minerals for economic growth, livelihood security, and future technologies but noted that supply chains are highly concentrated and easily subject to disruption or manipulation. Therefore, building resilient supply chains for critical minerals is a priority for the United States.
“We welcome the World Bank’s measures in formulating a strategy for critical minerals and look forward to its emphasis on investment and technical assistance to promote diversification and resilience in supply chains,” he stated.
(Some parts of this article were referenced from Reuters)