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The World Bank Group (WBG) is a family of five
international organization An international organization (also known as an international institution or intergovernmental organization) is a stable set of norms and rules meant to govern the behavior of states and other actors in the international system. Organizations ...
s that make
leveraged loanIn finance, leverage (or gearing in the United Kingdom and Australia) is any technique involving using debt (borrowed funds) rather than fresh Equity (finance), equity in the purchase of an asset, with the expectation that the after-tax profit to equ ...
s to
developing countries A developing country is a sovereign state with a less developed Industrial sector, industrial base and a low Human Development Index (HDI) relative to other countries. However, this definition is not universally agreed upon. There is also no ...

developing countries
. It is the largest and best-known
development bank Development or developing may refer to: Arts *Development hell Development hell, development purgatory, development limbo, or production hell, is a media Media may refer to: Physical means Communication * Media (communication), tool ...
in the world and an observer at the
United Nations Development Group The United Nations Sustainable Development Group (UNSDG), previously the United Nations Development Group (UNDG), is a consortium of 36 United Nations The United Nations (UN) is an intergovernmental organization that aims to maintain inte ...
. The bank is headquartered in
Washington, D.C. ) , image_skyline = , image_caption = Clockwise from top left: the Washington Monument The Washington Monument is an obelisk within the National Mall The National Mall is a Landscape architecture, landscape ...
in the
United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country Continental United States, primarily located in North America. It consists of 50 U.S. state, states, a Washington, D.C., ...

United States
. It provided around $98.83 billion in loans and assistance to "developing" and transition countries in the 2021 fiscal year. The bank's stated mission is to achieve the twin goals of ending extreme poverty and building shared prosperity.The World Bank, Press release: "World Bank Group Commitments Rise Sharply in FY14 Amid Organizational Change"
July 1 2014, http://www.worldbank.org/en/news/press-release/2014/07/01/world-bank-group-commitments-rise-sharply-in-fy14-amid-organizational-change
/ref> Total lending as of 2015 for the last 10 years through Development Policy Financing was approximately $117 billion. Its five organizations are the
International Bank for Reconstruction and Development The International Bank for Reconstruction and Development (IBRD) is an international financial institution An international financial institution (IFI) is a financial institution that has been established (or chartered) by more than one country ...
(IBRD), the
International Development Association The International Development Association (IDA) (french: link=no, Association internationale de développement) is an international financial institution An international financial institution (IFI) is a financial institution that has been estab ...

International Development Association
(IDA), the
International Finance Corporation The International Finance Corporation (IFC) is an international financial institution An international financial institution (IFI) is a financial institution that has been established (or chartered) by more than one country, and hence is subject ...

International Finance Corporation
(IFC), the
Multilateral Investment Guarantee Agency The Multilateral Investment Guarantee Agency (MIGA) is an international financial institution An international financial institution (IFI) is a financial institution that has been established (or chartered) by more than one country, and hence i ...

Multilateral Investment Guarantee Agency
(MIGA) and the
International Centre for Settlement of Investment Disputes International Centre for Settlement of Investment Disputes (ICSID) is an international arbitration institution established in 1966 for legal dispute resolution Dispute resolution or dispute settlement is the process of resolving disputes b ...

International Centre for Settlement of Investment Disputes
(ICSID). The first two are sometimes collectively referred to as the
World Bank The World Bank is an international financial institution An international financial institution (IFI) is a financial institution that has been established (or chartered) by more than one country, and hence is subject to international law. Its o ...
. The World Bank's (the IBRD's and IDA's) activities focus on
developing countries A developing country is a sovereign state with a less developed Industrial sector, industrial base and a low Human Development Index (HDI) relative to other countries. However, this definition is not universally agreed upon. There is also no ...
, 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. For example, a loan to improve coastal environmental management may be linked to the development of new environmental institutions at national and local levels and the implementation of new regulations to limit pollution. The World Bank has received various criticisms over the years and was tarnished by a scandal with its then President
Paul Wolfowitz Paul may refer to: *Paul (given name), a given name (includes a list of people with that name) *Paul (surname), a list of people People Christianity *Paul the Apostle (AD 5–67), also known as Saul of Tarsus or Saint Paul, early Christian mi ...

Paul Wolfowitz
and his aide, Shaha Riza, in 2007.


History


Founding

The WBG came into formal existence on 27 December
1946 Events January * January 6 ** The 1946 North Vietnamese parliamentary election, first general election ever in Vietnam is held. ** A revised and streamlined revival of Jerome Kern, Kern and Oscar Hammerstein II, Hammerstein's ''Show Boat'' ...
following international ratification of the Bretton Woods agreements, which emerged from the
United Nations Monetary and Financial Conference The Bretton Woods Conference, formally known as the United Nations Monetary and Financial Conference, was the gathering of 730 delegates from all 44 Allied nations at the Mount Washington Hotel The Mount Washington Hotel is a hotel in Bretton ...
(1–22 July 1944). It also provided the foundation of the
Osiander Committee Andreas Osiander (; 19 December 1498 – 17 October 1552) was a Germany, German Lutheran theology, theologian and Protestant reformer. Career Born at Gunzenhausen, Principality of Ansbach, Ansbach, in the region of Franconia, Osiander stud ...
in 1951, responsible for the preparation and evaluation of the
World Development Report The World Development Report (WDR) is an annual report published since 1978 by the International Bank for Reconstruction and Development The International Bank for Reconstruction and Development (IBRD) is an international financial institution ...
. 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 the Bank has issued to date).


Membership

All of the 193 UN members and
Kosovo Kosovo, or ; sr-Cyrl, Косово officially the Republic of Kosovo,; sr, / is a partially recognised state in Southeast Europe Southeast Europe or Southeastern Europe () is a geographical subregion A subregion is a part of a ...
that are WBG members participate at a minimum in the IBRD. As of May 2016, all of them also participate in some of the other four organizations (IDA, IFC, MIGA, and ICSID). WBG members by the number of organizations which they participate in: #only in IBRD: None #IBRD and one other organization:
San Marino San Marino (, ), officially the Republic of San Marino ( it, Repubblica di San Marino; ), also known as the Most Serene Republic Most Serene Republic ( la, Serenissima Respublica) is a title attached to a number of European states through hist ...

San Marino
,
Nauru Nauru ( or ; na, Naoero), officially the Republic of Nauru ( na, Repubrikin Naoero) and formerly known as Pleasant Island, is an island country An island country or an island nation is a country A country is a distinct territory, t ...

Nauru
,
Tuvalu Tuvalu ( or ; formerly known as the Ellice Islands Tuvalu ( ; formerly known as the Ellice Islands) is an island country An island country or an island nation is a country A country is a distinct territory, territorial ...

Tuvalu
,
Brunei Brunei ( ; ), officially the Nation of Brunei, the Abode of Peace ( ms, Negara Brunei Darussalam, Jawi alphabet, Jawi: ), is a sovereign state, country located on the north coast of the island of Borneo in Southeast Asia. Apart from its coa ...

Brunei
#IBRD and two other organizations:
Antigua and Barbuda Antigua and Barbuda (; ) is a sovereign state, sovereign island country in the West Indies in the Americas, lying between the Caribbean Sea and the Atlantic Ocean. It consists of two major islands, Antigua and Barbuda separated by , and smal ...
,
Suriname Suriname () or Surinam, officially known as the Republic of Suriname ( nl, Republiek Suriname ), is a country on the northeastern Atlantic coast of South America South America is a entirely in the and mostly in the , with a rela ...

Suriname
,
Venezuela Venezuela (; ), officially the Bolivarian Republic of Venezuela ( es, link=no, República Bolivariana de Venezuela), is a country on the northern coast of South America, consisting of a continent A continent is any of several large l ...

Venezuela
,
Namibia Namibia (, ), officially the Republic of Namibia, is a country in Southern Africa Southern Africa is the south South is one of the cardinal directions or compass points. South is the opposite of north and is perpendicular to the east a ...

Namibia
,
Marshall Islands The Marshall Islands, officially the Republic of the Marshall Islands ( mh, Aolepān Aorōkin Ṃajeḷ), is an independent near the in the , slightly west of the . Geographically, the country is part of the larger island group of . The countr ...
,
Kiribati Kiribati (), officially the Republic of Kiribati (Gilbertese language, Gilbertese: '' ibaberikiKiribati''),
#IBRD and three other organizations: India, Mexico, Belize, Jamaica, Dominican Republic, Brazil, Bolivia, Uruguay, Ecuador, Dominica, Saint Vincent and the Grenadines, Guinea-Bissau, Equatorial Guinea, Angola, South Africa, Seychelles, Libya, Somalia, Ethiopia, Eritrea, Djibouti, Bahrain, Qatar, Iran, Malta, Bulgaria, Poland, Russia, Belarus, Kyrgyzstan, Tajikistan, Turkmenistan, Thailand, Laos, Vietnam, Palau, Tonga, Vanuatu, Maldives, Bhutan, Myanmar #All five WBG organizations: the rest of the 138 WBG members Non-members are
Andorra Andorra (, ; ), officially the Principality of Andorra ( ca, Principat d'Andorra), is a sovereign Sovereign is a title which can be applied to the highest leader in various categories. The word is borrowed from Old French Old French ( ...

Andorra
,
Cuba Cuba ( , ), officially the Republic of Cuba ( es, República de Cuba, links=no ), is a country comprising the island of Cuba, as well as Isla de la Juventud Isla de la Juventud (; en, Isle of Youth) is the second-largest Cuban islan ...

Cuba
, Liechtenstein, Monaco, State of Palestine, Vatican City, and North Korea. The Taiwan, Republic of China joined the World Bank on December 27, 1945. After the Chinese Civil War, the government fled to Taiwan and continued its membership in the WBG until April 16, 1980 when the People's Republic of China replaced the ROC. Since then, it uses the name "Taiwan, China". Excluded from the list are the following unrecognized states: Abkhazia, Republic of Artsakh, Northern Cyprus, Somaliland, South Ossetia and Transnistria.


Organizational structure

Together with four affiliated agencies created between 1957 and 1988, the IBRD is part of the World Bank Group. The Group's headquarters are in
Washington, D.C. ) , image_skyline = , image_caption = Clockwise from top left: the Washington Monument The Washington Monument is an obelisk within the National Mall The National Mall is a Landscape architecture, landscape ...
It is an international organization owned by member governments; although it makes profits, they are used to support continued efforts in poverty reduction. Technically the World Bank is part of the United Nations system, but its governance structure is different: each institution in the World Bank Group is owned by its member governments, which subscribe to its basic share capital, with votes proportional to shareholding. Membership gives certain voting rights that are the same for all countries but there are also additional votes that depend on financial contributions to the organization. The President of the World Bank is nominated by the President of the United States and elected by the Bank's Board of Governors. 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% supermajority, the U.S. can block any major change in the Bank's governing structure. Because the U.S. exerts formal and informal influence over the Bank as a result of its vote share, control over the Presidency, and the Bank's headquarters location in Washington, D.C., friends and allies of the U.S. receive more projects with more lenient terms.


World Bank Group agencies

The World Bank Group consists of * the
International Bank for Reconstruction and Development The International Bank for Reconstruction and Development (IBRD) is an international financial institution An international financial institution (IFI) is a financial institution that has been established (or chartered) by more than one country ...
(IBRD), established in 1944, which provides debt financing on the basis of sovereign guarantees; * the
International Finance Corporation The International Finance Corporation (IFC) is an international financial institution An international financial institution (IFI) is a financial institution that has been established (or chartered) by more than one country, and hence is subject ...

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 The International Development Association (IDA) (french: link=no, Association internationale de développement) is an international financial institution An international financial institution (IFI) is a financial institution that has been estab ...

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 International Centre for Settlement of Investment Disputes (ICSID) is an international arbitration institution established in 1966 for legal dispute resolution Dispute resolution or dispute settlement is the process of resolving disputes b ...

International Centre for Settlement of Investment Disputes
(ICSID), established in 1965, which works with governments to reduce investment risk; * the
Multilateral Investment Guarantee Agency The Multilateral Investment Guarantee Agency (MIGA) is an international financial institution An international financial institution (IFI) is a financial institution that has been established (or chartered) by more than one country, and hence i ...

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 The World Bank is an international financial institution An international financial institution (IFI) is a financial institution that has been established (or chartered) by more than one country, and hence is subject to international law. Its o ...
" 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."About Us"
''wordbank.org'', accessed 30 May 2007.
The World Bank Institute is the capacity development branch of the World Bank, providing learning and other capacity-building programs to member countries. The IBRD has 189 member governments, and the other institutions have between 153 and 184. The institutions of the World Bank Group are all run by a board of governors meeting once a year. Each member country appoints a governor, generally its Minister of Finance. On a daily basis, the World Bank Group is run by a board of 25 executive directors to whom the governors have delegated certain powers. Each director represents either one country (for the largest countries), or a group of countries. Executive directors are appointed by their respective governments or the constituencies. The agencies of the World Bank are each governed by their Articles of Agreement that serve as the legal and institutional foundation for all their work. The activities of the International Finance Corporation, IFC and Multilateral Investment Guarantee Agency, MIGA include investment in the private sector and providing insurance, respectively.


Presidency

Traditionally, the Bank President has been a U.S. citizen nominated by the President of the United States, the bank's largest shareholder. The nominee is subject to confirmation by the executive directors, to serve a five-year, renewable term.


Current president

On 5 April 2019, David Malpass was selected as the 13th World Bank Group President; his term began on 9 April 2019.


Managing director

The managing director of The World Bank is responsible for organizational strategy; budget and strategic planning; information technology; shared services; Corporate Procurement; General Services and Corporate Security; the Sanctions System; and the Conflict Resolution and Internal Justice System. The present MD, Shaolin Yang, assumed the office after Sri Mulyani resigned to become finance minister of Indonesia.


Extractive Industries review

After longstanding criticisms from civil society of the Bank's involvement in the oil, gas, and mining industry, mining sectors, the World Bank in July 2001 launched an independent review called the ''Extractive Industries Review'' (EIR—not to be confused with Environmental impact assessment, Environmental Impact Report). The review was headed by an "Eminent Person", Emil Salim, Dr. Emil Salim (former Environment Minister of Indonesia). Salim held consultations with a wide range of stakeholders in 2002 and 2003. The EIR recommendations were published in January 2004 in a final report, "Striking a Better Balance"."Striking a Better Balance"
''worldbank.org'', January 2004, accessed 30 May 2007.
The report concluded that fossil fuel and mining projects do not alleviate poverty, and recommended that World Bank involvement with these sectors be phased out by 2008 to be replaced by investment in renewable energy and Sustainable energy, clean energy. The World Bank published its Management Response to the EIR in September 2004 after extensive discussions with the board of directors. The Management Response did not accept many of the EIR report's conclusions, but the EIR served to alter the World Bank's policies on oil, gas, and mining in important ways, as the World Bank documented in a recent follow-up report."Oil, Gas, Mining, and Chemicals" (follow up report)
accessed 30 May 2007.
One area of particular controversy concerned the rights of indigenous peoples. Critics point out that the Management Response weakened a key recommendation that indigenous peoples and affected communities should have to provide 'consent for projects to proceed; instead, there would be 'consultation'. Following the EIR process, the World Bank issued a revised Policy on Indigenous Peoples.


Criticism

World Bank#Criticisms, The World Bank has long been criticized by a range of non-governmental organizations and academics, notably including its former Chief Economist Joseph Stiglitz, who is equally critical of the International Monetary Fund, the US Treasury Department, and US and other developed country trade negotiators.See Joseph Stiglitz, ''The Roaring Nineties'', ''Globalization and Its Discontents'', and ''Making Globalization Work''. Critics argue that the so-called free market reform policies—which the Bank advocates in many cases—in practice are often harmful to economic development if implemented badly, too quickly ("shock therapy (economics), shock therapy"), in the wrong sequence, or in very weak, uncompetitive economies. World Bank loan agreements can also force procurements of goods and services at uncompetitive, non-free-market, prices. Other critical writers such as John Perkins (author), John Perkins, label the international financial institutions as 'illegal and illegitimate' and a cog of coercive American diplomacy in carrying out financial terrorism. In ''Masters of Illusion: The World Bank and the Poverty of Nations'' (1996), Catherine Caufield argues that the assumptions and structure of the World Bank operation ultimately harm developing nations rather than promoting them. Caufield first criticizes the highly homogenized and Western recipes of "development" the Bank holds. To the World Bank, different nations and regions are indistinguishable and ready to receive the "uniform remedy of development". The danger of this assumption is that to attain even small portions of success, Western approaches to life are adopted and traditional economic structures and values are abandoned. A second assumption is that poor countries cannot modernize without money and advice from abroad. A number of intellectuals in developing countries have argued that the World Bank is deeply implicated in contemporary modes of donor and NGO-driven imperialism and that its intellectual contribution functions, primarily, to seek to blame the poor for their condition. Defenders of the World Bank contend that no country is forced to borrow its money. The Bank provides both loans and grants. Even the loans are concessional since they are given to countries that have no access to international capital markets. Furthermore, the loans, both to poor and middle-income countries, are at below market-value interest rates. The World Bank argues that it can help development more through loans than grants, because money repaid on the loans can then be lent for other projects. Criticism was also expressed towards the IFC and MIGA and their way of evaluating the social and environmental impact of their projects. Critics state that even though IFC and MIGA have more of these standards than the World Bank, they mostly rely on private-sector clients to monitor their implementation and miss an independent monitoring institution in this context. This is why an extensive review of the institutions' implementation strategy of social and environmental standards is demanded.


Allegations of corruption


The World Bank's Integrity Vice Presidency (INT)
is charged with the investigation of internal fraud and corruption, including complaint intake, investigation, and investigation reports.


Investments

The World Bank Group has also been criticized for investing in projects with human rights issues. The Compliance Advisor/Ombudsman (CAO) criticized a loan the Bank made to the palm oil company Dinant after the 2009 Honduran coup d'état. There have been numerous killings of campesinos in the region where Dinant was operating. Other controversial investments include loans to the Chixoy Hydroelectric Dam in Guatemala while it was under military dictatorship, and to Goldcorp (then Glamis Gold) for the construction of the Marlin Mine. In 2019, the Congressional-Executive Commission on China questioned the World Bank about a loan in Xinjiang, Xinjiang, China, that was used to buy high-end security gear, including surveillance equipment. The Bank launched an internal investigation in response to the allegation. In August 2020, U.S. lawmakers questioned the continued disbursement of the loan.


List of presidents

*Eugene Meyer (financier), Eugene Meyer (18 June 1946 – 4 December 1946) *John J. McCloy (17 March 1947 – 1 July 1949) *Eugene R. Black, Sr. (1 July 1949 – 1 January 1963) *George David Woods, George D. Woods (1 January 1963 – 1 April 1968) *Robert McNamara (1 April 1968 – 1 July 1981) *Alden W. Clausen (1 July 1981 – 1 July 1986) *Barber Conable (1 July 1986 – 1 September 1991) *Lewis Thompson Preston, Lewis T. Preston (1 September 1991 – 1 February 1995) *Acting: Ernest Stern (1 February 1995 – 1 June 1995) *James Wolfensohn (1 June 1995 – 1 June 2005) *
Paul Wolfowitz Paul may refer to: *Paul (given name), a given name (includes a list of people with that name) *Paul (surname), a list of people People Christianity *Paul the Apostle (AD 5–67), also known as Saul of Tarsus or Saint Paul, early Christian mi ...

Paul Wolfowitz
(1 June 2005 – 1 July 2007) *Robert Zoellick (1 July 2007 – 1 July 2012) *Jim Yong Kim (1 July 2012 – 1 February 2019) *Kristalina Georgieva (1 February 2019 – 4 April 2019) (Interim) *David Malpass (5 April 2019 – present)


List of chief economists

*Hollis B. Chenery (1972–1982) *Anne Osborn Krueger (1982–1986) *Stanley Fischer (1988–1990) *Lawrence Summers (1991–1993) *Michael Bruno (1993–1996) *Joseph Stiglitz, Joseph E. Stiglitz (1997–2000) *Nicholas Stern, Baron Stern of Brentford, Nicholas Stern (2000–2003) *François Bourguignon (2003–2007) *Justin Yifu Lin (June 2008 – June 2012) *Martin Ravallion - (June 2012 – October 2012) *Kaushik Basu (October 2012 – July 2016) *Paul Romer (August 2016 – January 2018) *Shanta Devarajan (January 2018 – November 2018) (Acting) *Pinelopi Koujianou Goldberg (November 2018 – February 2020) *Aart Kraay (March 2020 – June 2020) (Acting) *Carmen Reinhart (June 2020 – present)


List of World Bank Directors-General of Evaluation

*Christopher Willoughby (World Bank Group), Christopher Willoughby, Successively Unit Chief, Division Chief, and Department Director for Operations Evaluation (1970–1976) *Mervyn L. Weiner, First Director-General, Operations Evaluation (1975–1984) *Yves Rovani, Director-General, Operations Evaluation (1986–1992) *Robert Picciotto, Director-General, Operations Evaluation (1992–2002) *Gregory K. Ingram, Director-General, Operations Evaluation (2002–2005) *Vinod Thomas, Director-General, Evaluation (2005–2011) *Caroline Heider, Director-General, Evaluation (2011–present)


See also

*Brazil and the World Bank *China and the World Bank *Honduras and the World Bank *Zimbabwe and the World Bank *


References


External links

* {{United Nations World Bank Group, United Nations specialized agencies International development organizations Multilateral development banks United Nations Development Group United Nations Economic and Social Council Banks established in 1945 Non-profit organizations based in Washington, D.C. Organizations established in 1945