Objectives
Members of the consortium share a common vision of a "world free of poverty" through economic development, with the aim of improving people's living standards by promoting economic growth and development. The World Bank Group is one of the world's largest sources of development assistance. The Bank works in more than 100 developing economies with the primary focus is lending to the poorest countries.
The Bank advocates strengthening economies and expanding markets to improve the quality of life for people everywhere, especially the poorest. Unlike aid programs, the Bank doesn't make grants. The Bank lends money to developing countries-and the loans are repaid. The money for bank loans comes from investors around the world. These investors buy bonds issued by the World Bank.
Budget
$17.3 billion for the 2001 fiscal year.
Member organisations of the World Bank
- International Bank for Reconstruction and Development (IBRD)
Established in 1945, the IBRD provides loans and development assistance to middle-income countries and "creditworthy" poorer countries. The bank is like a global co-operative which is owned by member countries. The size of a country's shareholding is determined by the size of the country's economy relative to the world economy. IBRD raises most of its funds on the world's financial markets.
- International Finance Corporation (IFC)
Established in 1956, the IFC promotes growth in the developing world by financing private sector investments and providing technical assistance and advice to governments and businesses. The mission of IFC, part of the World Bank Group, is to promote sustainable private sector development in developing countries, helping to reduce poverty and improve people's lives.
- International Development Association (IDA)
Established in 1960, IDA supports the Bank's poverty reduction mission by focusing on the poorest countries to which it provides long-term, interest free loans and other services. IDA's goal is to reduce disparities across and within countries, especially in access to primary education, basic health, and water supply and sanitation, and to bring more people into mainstream by raising their productivity.
IDA lends to countries that have a per capita income, as per 2000 figures, of less than $885 and lack the financial ability to borrow from IBRD. At present, 79 countries are eligible to borrow from IDA. Together these countries are home to 2.5 billion people, comprising half of the total population of the developing countries.(1)
- The International Centre for Settlement of Investment Disputes (ICSID)
Established in 1966, the ICSID provides facilities for settlement - by conciliation or arbitration - of investment disputes between foreign investors and their host countries.
ICSID has an Administrative Council and a Secretariat. The Administrative Council is chaired by the World Bank's President and consists of one representative of each State which has ratified the Convention. Annual meetings of the Council are held in conjunction with the joint Bank/IMFannual meetings.
ICSID is an autonomous international organization. However, it has very close links with the World Bank. All of ICSID's members are also members of the Bank. Unless a government makes a contrary designation, its Governor for the Bank sits ex officio on ICSID's Administrative Council. The expenses of the ICSID Secretariat are financed out of the Bank's budget, although the costs of individual proceedings are borne by the parties involved.
- Multilateral Investment Guarantee Agency (MIGA)
Established in 1988, MIGA encourages foreign investment in developing countries by providing guarantees to foreign investors against loss caused by non-commercial risks.
MIGA's mission is to stimulate the flow of overseas investment to developing countries and economies in transition. MIGA provides both "hands-on" operational and a range of investment information services to assist member countries and firms contemplating direct investments in the developing world. MIGA also provides a broad range of technical assistance to investment promotion intermediaries, tailored specifically to the clients' needs. Core services and products that MIGA offers fall into three broad categories mainly: capacity building, information dissemination and investment facilitation.
The World Bank Group has taken the lead in pushing certain market-lead principles, mainly privatisation of infrastructure services, on governments of developing countries. The Bank claims that such principles are capable of providing more efficient services with better quality and cost recovery in a specified period of time. The Bank Group and other International Financial Institutions (IFIs) have also specified that some countries reduce domestic spending as part of a Structural Adjustment Programs (SAPs) which induce their privatisation policies.
(1)Both IBRD and IDA are run on the same lines. They share the same staff, the same headquarters, report to the same president and use the same rigorous standards when evaluating projects. IDA simply takes its money out of a different 'drawer'. A country must be a member of IBRD before it can join IDA; 162 countries are IDA members.
(2) Johnstone & Wood, (1999), Sohail &Budds, (2000), Nickson, A. (1997).
World Bank website