US Treasury Secretary Scott Bessent on Wednesday called on the International Monetary Fund (IMF) to intensify scrutiny of 'non-market policies and practices and exchange rates,' warning that the Fund risks being 'sidelined' if it fails to act on distortionary economic practices. Bessent also described the planned phase-out of World Bank lending to China and Poland as 'an important milestone,' delivering the remarks in a written statement to both the World Bank Development Committee and the IMF's International Monetary and Financial Committee at the IMF-World Bank Annual Meetings in Bangkok.

What Bessent Said on IMF's Role

The written statement zeroed in on what Bessent described as a critical gap in IMF oversight. 'One area where this refocus must go further is in the IMF's work on global imbalances,' the statement read, specifically highlighting the need to strengthen 'analysis and engagement on the role non-market policies and practices and exchange rates play in driving external imbalances.'

Without naming any specific country in that passage, Bessent noted that policymakers were engaged in 'difficult discussions about how to sustain market-based systems amid distortionary policies from some economies that skew competition and hurt employment.' He warned that the IMF — founded, in his framing, precisely to prevent such distortions — 'must exercise its voice on this critical issue or risk being sidelined.'

World Bank Lending to China and Graduation Criteria

On the World Bank, Bessent urged the lender to phase out sovereign lending to countries that have 'long met its graduation criteria.' He singled out the planned phase-outs for China and Poland as overdue but welcome, calling them 'an important milestone for both countries.'

Critically, Bessent flagged a structural concern: the Bank was entering 'the longest period in its history without a country graduating from lending eligibility,' and he called on management to 'take concrete steps to ensure that graduations resume.' The statement signals sustained US pressure on multilateral lenders to recalibrate who qualifies for concessional financing.

IMF Resources, Quota Reform and Energy Financing

Bessent affirmed that the United States 'remains committed to a strong, quota-based, and adequately resourced IMF,' and said Washington was working to secure congressional approval for the 16th General Review of Quotas. He added that 'any future quota realignment should reflect members' relative position in the world economy and be based on a new quota formula' — language that analysts note could reshape voting power within the Fund.

The statement also took aim at two specific IMF and World Bank financing mechanisms. Bessent called on the World Bank Group to 'formally retire its prohibition on financing upstream gas and oil,' a position that puts Washington at odds with climate-aligned lending policies pursued in recent years. He also criticised IMF financing through the Resilience and Sustainability Trust, arguing it 'veers into development-policy lending' beyond the Fund's core mandate.

Context: IMF-World Bank Annual Meetings in Bangkok

The remarks were delivered at the IMF-World Bank Annual Meetings being held in Bangkok this week — the first time the joint meetings have taken place in Southeast Asia in years. The International Monetary and Financial Committee advises the IMF's Board of Governors, while the Development Committee advises the boards of both institutions on development policy. This comes amid broader US-China economic tensions and ongoing global debate over the governance structure and lending priorities of multilateral institutions.

Notably, the statements did not name China in the context of 'distortionary policies,' but the framing — targeting non-market exchange rate practices and competitive distortions — echoes longstanding US complaints against Beijing's economic model. How the IMF's membership responds to Washington's push for structural reform of quota formulas and graduation criteria will be among the key tests of US multilateral leverage heading into 2027.