World Bank President David Malpass and other economic leaders attend a roundtable discussion in Beijing, China, on November 21. Photo by Stephen Shaver/UPI | License Photo
Dec. 6 (UPI) -- The U.S. government said it objects to a new five-year plan by the World Bank to grant China more than $1 billion in new loans, to carry out fiscal reforms and stimulate economic growth in the private sector.
The World Bank issued the framework of the deal on Thursday, which earmarks between $1 billion and $1.5 billion for projects in China. Other goals of the aid are to improve green development and healthcare and help Beijing lower carbon emissions.
The World Bank's executive directors said there is broad support for its lending plan, which was granted after discussions about China's structural and environmental reforms.
"China has achieved substantial development success since it started structural reform and opening up policies in 1978," the bank said in a statement. "China's [gross domestic product] and income growth accelerated dramatically as it developed, and over 850 million people were lifted out of poverty."
"Our engagement will be increasingly selective," said World Bank Director Martin Raiser. "Future World Bank lending will primarily focus on China's remaining gaps in policies and institutions for sustainable graduation."
U.S. Treasury Secretary Steven Mnuchin criticized the bank's move, telling lawmakers Thursday it should slow lending to Beijing -- and cut China's overall borrowing this year from the current $1.3 billion to below $1 billion. In 2017, the bank lent $2.4 billion in Chinese loans.
"We negotiated significant reductions in China lending with a path to get below $1 billion," Mnuchin said. "We submitted our objection to the current country plan."
White House economic adviser Larry Kudlow said Friday U.S. and Chinese negotiators are close to a trade agreement to end the conflict that's been going for more than a year. A new phase of the conflict, $160 billion worth of new U.S. tariffs for Chinese products, will take effect Dec. 15.