WORT BANK

World Bank (often referred to by employees and
others as simply "the Bank") is an internationally supported
bank that provides financial and technical assistance[1]
to developing countries for development programs (e.g.
bridges, roads, schools, etc.) with the stated goal of reducing poverty.
The World Bank differs from the World Bank Group in that the
 former comprises only the
International Bank for Reconstruction and Development
 and the International Development Association, while the
latter incorporates these entities in addition to three others
.[2] The World Bank was formally established on
December 27, 1945, following the ratification of the
 Bretton Woods agreement. The concept was originally
conceived in July 1944 at the United Nations Monetary and Financial Conference
. Two years later, the Bank issued its first loan: $250 million to
France for post-war reconstruction, the main focus
of the Bank's work in the early post-World War II years.
Over time, the "development" side of the Bank's work has
ssumed a larger share of its lending, although it is still
involved in post-conflict reconstruction, together with
construction after natural disasters, response to humanitarian
mergencies and post-conflict rehabilitation needs affecting
developing and transition economies. There are some criticisms
 of the results of the World Bank's "development schemes"
 leading to corruption and widespread exploitation of the
corporations who are given monopolies of developing nation's resources.

 

Activities

The World Bank headquarters in Washington DC
The World Bank headquarters in Washington DC

The World Bank is one of the two Bretton Woods Institutions
 which were created in 1944 to rebuild a war-torn Europe after
 World War II. Later, largely due to the contributions of the
 Marshall Plan, the World Bank was forced to find a new area
n which to focus its efforts. Subsequently, it began attempting to
 rebuild the infrastructure of Europe's former colonies. Since
 then it has made a variety of changes regarding its focus and goals.
 From 1968-1981 it focused largely on poverty alleviation. From the
 '80s and into the 1990s its main focus was both debt management
 and structural adjustment. Today the focus is on the achievement
 of the Millennium Development Goals (MDGs), goals calling for
the elimination of poverty and the implementation of sustainable
 development. Of the two constituent parts of the Bank, the IBRD
lends primarily to "middle-income countries" at interest rates which
 reflect a small mark-up over its own (AAA-rated) borrowings from
 capital markets; while the IDA provides low or no interest loans and
 grants to low income countries with little or no access to international
credit markets. The IBRD is a market based non-profit organization,
 using its high credit rating to make up for the relatively low interest
rate on its loans, while the IDA is funded primarily by periodic
 "replenishments" (grants) voted to the institution by its more
 affluent member countries.

The Bank’s mission is to aid developing countries and their inhabitants
 achieve development and the reduction of poverty, including
 achievement of the MDGs, by helping countries develop an
environment for investment, jobs and sustainable growth,
thus promoting economical growth and through investment in
 and empowerment of the poor to enable them to participate in
development. The World Bank sees the five key factors necessary
 for economic growth and the creation of a business environment as:

  1. Build capacity – Strengthening governments and educating
  2.  government officials
  3. Infrastructure creation – implementation of legal and judicial
  4. systems for the encouragement of business, the protection
  5. of individual and property rights and the honoring of contracts
  6. Development of Financial Systems – the establishment of
  7.  strong systems capable of supporting endeavors from
  8.  micro credit to the financing of larger corporate ventures
  9. Combating corruption – Support for countries' efforts at eradicating
  10.  corruption
  11. Research, Consultancy and Training - the World Bank provides
  12. platform for research on development issues, consultancy and
  13.  conduct training programs (web based, on line, video/tele
  14. conferencing and class room based) open for those who are
  15.  interested from academia, students, government and
  16. non-governmental organization (NGO) officers etc.

The Bank obtains funding for its operations primarily through the
 IBRD’s sale of AAA-rated bonds in the world’s financial markets.
 The IBRD’s income is generated from its lending activities, with
its borrowings leveraging its own paid-in capital, plus the in
vestment of its "float". The IDA obtains the majority of its
 funds from forty donor countries who replenish the bank’s
funds every three years, and from loan repayments, which
then become available for re-lending.

The Bank offers two basic types of loans: investment loans and
development policy loans. The former are made for the support
 of economic and social development projects, whereas the latter
 provide quick disbursing finance to support countries’ policy and
 institutional reforms. While the IBRD provides loans with a
elatively low interest rate, the IDA’s "credits" are interest free.
 The project proposals of borrowers are *******uated for their
economical, financial, social and environmental aspects prior
 to their approval.

The Bank also distributes grants for the facilitation of development
projects through the encouragement of innovation, cooperation
between organizations and the participation of local stakeholders
in projects. IDA grants are predominantly used for:

  • Debt burden relief in the most indebted and poverty struck countries
  • Amelioration of sanitation and water supply
  • Support of vaccination and immunization programs for the
  • reduction of communicable diseases such as malaria
  • Combating the HIV/AIDS pandemic
  • Support civil society organizations
  • Creating initiatives for the reduction of greenhouse gases

The Bank not only provides financial support to its member states
, but also analytical and advisory services to facilitate the
 implementation of the lasting economic and social improvements
that are needed in many under-developed countries, as well as
 educating members with the knowledge necessary to resolve
their development problems while promoting economic growth.

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