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The World Bank plans to end lending to China by 2031 under a new agreement with Beijing, reflecting the country’s emergence as the world’s second-largest economy and a years-long decline in financing from the multilateral lender, Reuters reported on Wednesday, citing sources familiar with the plan.
The proposal, which will be reviewed by the World Bank’s board during the week of July 20, does not require a formal vote and has been jointly agreed upon by the World Bank and China as part of the lender’s latest five-year Country Partnership Framework, the report said.
The move would cap World Bank lending to China at around $2 billion between now and 2031 before ending new development loans altogether, the report said.
Lending has fallen sharply over the years
The World Bank’s lending to China has already been declining steadily over the past several years. Annual lending dropped from $2.4 billion in 2017 to just $750 million in 2025, reflecting China’s transformation from a developing economy into a major global economic power.
China stopped qualifying for concessional loans from the World Bank’s International Development Association (IDA), which supports the world’s poorest countries, in 2000. It later became a contributor to the fund in 2007 and has since grown into its fifth-largest donor.
“China has made significant development advances over the past several decades,” a World Bank official familiar with the matter told Reuters. “Now we are reaching a new phase of our relationship, reflecting that reality.”
Long-standing US demand
The decision is expected to be welcomed by the United States, which has repeatedly argued that China should no longer receive development financing from multilateral institutions given the size and strength of its economy.
China’s continued access to World Bank loans has been a source of friction with Washington since the first administration of US President Donald Trump, which had pushed international financial institutions to reduce support for Beijing.
Responding to the proposed phase-out, a spokesperson for the US Treasury described the move as “a step in the right direction” and said Washington hoped other multilateral lenders would follow suit.
“As the second-largest economy in the world, China should not be receiving handouts from multilateral institutions,” the spokesperson said.
A senior US official also urged institutions including the Asian Development Bank, the International Fund for Agricultural Development and United Nations agencies to end development assistance for China, arguing that such funding should instead be directed towards poorer countries.
Similar approach adopted for Poland
The World Bank has also adopted a similar strategy for Poland. Earlier this month, it agreed to stop development lending to the Central European country after 2031, signalling a broader shift in how the institution allocates resources to countries that have achieved higher levels of economic development.
The planned withdrawal from China underscores the World Bank’s evolving focus on directing scarce development finance towards lower-income nations with greater funding needs, while transitioning wealthier economies away from borrowing from the institution.
