The World Bank will cease new lending to China after 2031, capping annual commitments at $2 billion until then, as the institution recalibrates its relationship with the world’s second-largest economy. The decision, embedded in a new five-year Country Partnership Framework, marks a formal graduation from development financing for a country that has seen its per capita income and poverty indicators transform over four decades.

The framework, agreed between Bank management and Beijing, will be presented to the Board of Executive Directors during the week of 20 July, though no formal vote is required. Lending volumes have already contracted sharply: from a peak of $2.4 billion in 2017 to $750 million in 2025. Under the new arrangement, the Bank will shift to providing advisory services and technical expertise, mirroring the transition announced for Poland on 16 June, which also ends lending by 2031.

The move crystallises long-standing pressure from Washington and other Western capitals. During his first term, President Donald Trump demanded the Bank halt loans to China, arguing a major economy should not access concessional finance. A US Treasury spokesperson described the phase-out as “a step in the right direction” and said Washington expects other multilateral institutions to follow suit. China, meanwhile, has deepened its role as a donor: it pledged $1.5 billion to the Bank’s International Development Association in the latest replenishment, making it the fifth-largest contributor to the fund for the poorest countries.

The next milestone is the Board’s review of the framework, which will proceed without a vote. Once endorsed, the cap takes effect immediately, with lending tapering to zero by the end of the decade. The Bank will continue to provide knowledge partnerships, particularly in financial sector strengthening and public services, while China’s own overseas lending—through bilateral channels and the Belt and Road Initiative—underscores its dual identity as both a development partner and a former borrower.