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The World Bank

Multilateral Development Banks: Overview

• World Bank Group• International Bank for Reconstruction and

Development (IBRD)

• International Development Association (IDA)

• International Finance Corporation (IFC)

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• African Development Bank (AfDB)

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• Asian Development Bank (AsDB)

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• European Bank for Reconstruction and Development (EBRD)

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• Inter-American Development Bank (IDB)

• Primarily middle-income governments, also some creditworthy low-income

• Low-income governments• Private sector firms in developing countries (middle -and

low income countries)

----------------------------------------------• Middle -income governments, some creditworthy

low -income governments, and private sector firms in the region

-------------------------------------------------• Middle-income governments, some creditworthy low-

income governments, and private sector firms in the region

------------------------------------• Primarily private sector firms in developing countries in

the region, also developing -country governments in the region

-----------------------------• Middle-income governments, some creditworthy low-

income governments, and private sector firms in the region

The World Bank Group (WBG) is a family of

five international organizations that make

leveraged loans to developing countries.

It is the largest and most famous

development bank in the world and is an

observer at the United Nations Development

Group]

The bank is based in Washington, D.C. and

provided around $61 billion in loans and

assistance to "developing" and transition

countries in the 2014 fiscal year

The WBG came into formal existence on 27

December 1945 following international

ratification of the Bretton Woods agreements.

Commencing operations on 25 June 1946, it

approved its first loan on 9 May 1947

(US$250M to France for postwar

reconstruction, in real terms the largest loan

issued by the Bank to date).

All of the 193 UN members and Kosovo that

are WBG members participate at a minimum in

the IBRD. Most of them also participate in

some of the other 4 organizations

The World Bank is like a cooperative, made up

of 188 member countries. These member

countries, or shareholders, are represented by

a Board of Governors, who are the ultimate

policymakers at the World Bank

As of 15 November 2009 the United States

held 16.4% of total votes, Japan 7.9%,

Germany 4.5%, the United Kingdom 4.3%, and

France 4.3%.

As changes to the Bank's Charter require an

85% super-majority, the US can block any

major change in the Bank's governing structure

The President of the World Bank is nominated

by the President of the United States and

elected by the Bank's Board of Governors

World Bank Group agencies

The World Bank Group consists of:

• the International Bank for Reconstruction and Development (IBRD), established in 1945, which provides debt financing on the basis of sovereign guarantees;

• the International Finance Corporation (IFC), established in 1956, which provides various forms of financing without sovereign guarantees, primarily to the private sector;

• the International Development Association (IDA), established in 1960, which provides concessional financing (interest-free loans or grants), usually with sovereign guarantees;

• the International Centre for Settlement of Investment Disputes (ICSID), established in 1965, which works with governments to reduce investment risk;

• the Multilateral Investment Guarantee Agency (MIGA), established in 1988, which provides insurance against certain types of risk, including political risk, primarily to the private sector.

The term "World Bank" generally refers to just the IBRD and IDA, whereas the term World Bank Group or WBG is used to refer to all five institutions collectively.[8]

• The World Bank Institute is the capacity development branch of the World Bank, providing learning and other capacity-building programs to member countries.

The World Bank's (the IBRD and IDA's) activities are

focused on developing countries, in fields such as

human development (e.g. education, health),

agriculture and rural development (e.g. irrigation

and rural services), environmental protection (e.g.

pollution reduction, establishing and enforcing

regulations), infrastructure (e.g. roads, urban

regeneration, and electricity), large industrial

construction projects, and governance (e.g. anti-

corruption, legal institutions development).

The IBRD and IDA provide loans at preferential rates

to member countries, as well as grants to the

poorest countries. Loans or grants for specific

projects are often linked to wider policy changes in

the sector or the country's economy as a whole.

IDA resources

• IDA is financed largely by contributions from partner governments.

• Additional financing comes from transfers from IBRD’s net income, grants from the International Finance Corporation (IFC), and borrowers’ repayments of earlier IDA credits.

• Every three years, contributing partners and representatives of borrower countries meet to agree on IDA’s strategic direction, priorities, and financing for the subsequent three-year implementation period.

• Under the IDA17 Replenishment, which covers fiscal 2015–17, total resources amount to 33.7 billion in Special Drawing Rights (SDR) (equivalent to $50.8 billion).

• Cumulative Lending Commitments by Country (1947 onwards)

12,425 projects in 173 countries

Objectives

The World Bank Group has set two goals for the

world to achieve by 2030:

• End extreme poverty by decreasing the

percentage of people living on less than $1.90

a day to no more than 3%

• Promote shared prosperity by fostering the

income growth of the bottom 40% for every

country

Program Organization

GENERAL MANAGEMENT UNITS

• Development Economics

• Development Finance

• External and Corporate Relations

• Human Resources

• WBG Information and Technology Solutions

• Integrity Vice Presidency

• Legal

REGIONAL UNITS

• Africa

• East Asia & Pacific

• Europe & Central Asia

• Latin America & the Caribbean

• Middle East & North Africa

• South Asia

GLOBAL PRACTICES

• Agriculture

• Education

• Energy and Extractives

• Energy | Extractive Industries

• Environment and Natural Resources

• Finance and Markets

• Governance

• Health, Nutrition, and Population

CROSS-CUTTING SOLUTIONS AREAS

• Climate Change

• Fragility, Conflict, and Violence

• Gender

• Jobs

• Public-Private Partnerships

Fiscal 2015 Regional Highlights

Africa

• The World Bank approved $11.6 billion for 103 projects in fiscal 2015.

East Asia and Pacific »


Middle East and North Africa


Europe and Central Asia


Latin America and the Caribbean


South Asia


World Bank Regional Commitments, Fiscal 2015

Region

• Africa 27%

• East Asia and Pacific 15%

• Europe and Central Asia 17%

• Latin & Caribbean 14%

• Middle East and N Africa 8%

• South Asia 18%

World Bank’s project cycle

1. Overall development strategy

The Bank’s Country Assistance Strategy (CAS) forms the blueprint

2. Project identification

The borrower and Bank analyze development strategies (e.g. PRSP and CAS) and generate project ideas. The Bank’s economic and sector research is influential at this stage.

After project identification, the Bank country team creates a Project Concept Note (PCN), an internal document of four to five pages. The Project Information Document (PID) is prepared after an internal Bank review of the PCN and is released to the public. It contains information on the project’s objectives, a brief description and the name of the World Bank Task Manager who is supervising the project.


3. Preparation

• This phase is supposed to be country driven. “Technical, institutional, economic, environmental and financial issues facing the project” are studied.

4. Appraisal

• The Bank is solely responsible for project appraisal. Bank staff review the work done during identification and preparation, often spending three to four weeks in the client country


5. Negotiation and approval

• Both sides come to an agreement on the terms and conditions of the loan. The documents setting out the Bank’s assessment of the feasibility and justification for the program along with the memorandum of the president and legal documents are then submitted to the Bank’s board for approval.

• Submission of relevant documents for final clearance by the borrowing government is done at this stage and may involve ratification by a council of ministers or a country’s legislature.

6. Implementation and supervision

• Project implementation is the responsibility of the borrowing country, while the Bank is responsible for supervision.


7. Completion

• At the end of the loan disbursement period, a completion report (staff self-evaluations) identifying accomplishments, problems, and lessons learned is submitted to the Bank board for information purposes

8. Evaluation

• The Operations Evaluation Department (OED) conducts an audit to measure project outcomes against the original objectives. The audit reviews the project completion report and a separate report is produced. Both reports are submitted to the executive directors and the borrower. These are not released to the public.

• Project performance assessment reports – produced by OED staff and involve country visitsImpact evaluation reports – conducted 5-8 years after loan disbursementInspection panel reports

Loans/ Grants by Sector

Sector # Projects % Total

Agriculture 170 8 %

Climate Change 2 <1 %

Education 136 18 %

Energy & Extrs 218 10 %

Env & Nat Res 182 9 %

Fin & Markets 49 10 %

Governance 77 6 %

Health, N, Pop 95 9 %

Sector # Projects % Total

Econ& Fisc Mgmt 6 17 %

Other 1 <1 %

Poverty and Equity 10 10 %

Soc Prot & Labor 83 10 %

Social, Urban, Rural1 94 6 %

Trade & Compet 52 12 %

Transport & ICT 214 7 %

Water 171 5 %

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