1. Presented by: Elena Pak Matt Gompers ECON 490
The World Bank
Presented by:
Elena Pak
Matt Gompers
ECON 490

2. Organization The President:
Robert B. Zoellick, effective July 1, 2007.
President serves a 5-year term, at the pleasure of executive directors.
Has many titles, including
Chairman of the Board of Directors of the International Development Association
Chairman of the Board of Directors of the International Finance Corporation
Chairman of the Administrative Council of the International Centre for the Settlements of Investment Disputes
Chairman of the Board of Directors of the Multilateral Investment Guarantee Agency
Executive Directors select a President, who serves as Chairman of the Boards
Approves the President’s contract
Has authority to remove
There are four Boards of Directors for each associate institution

3. World GDP Proportions

4. Election of Executive Directors
Under the Articles of Agreement International Bank for Reconstruction and Development (IBRD) the five largest shareholders appoint an Executive Director and remaining members elect the other Executive Directors (currently 19 elected, 5 appointed, total 24)
Under the Articles of Agreement of IDA and IFC the Executive Directors of the IBRD serve ex officio as Executive Directors of IDA and as members of the Board of Directors of IFC. The MIGA has its own separate Board of Directors consisting of 24 members. All members of MIGA Board are elected in practice the same individuals are chosen to serve on the IBRD Board of Executive Directors and the MIGA Board.
Regular elections of Executive Directors are held every two years and are normally concluded at time of Annual Meetings
NOTE: The rules for each regular elections are approved in advance of the election by a majority vote of the Board of Governors

5. Responsibilities & Functions of Executive Directors
Executive Directors are responsible for the general operations of the Bank and exercise all powers delegated to them by the Board of Governors under Articles of Agreement.
EDs function in continuous session at the Bank and meet as often as business may require
EDs consider and decide IBRD loans and guarantee proposals, IDA credit grants guarantee proposals made by the President, and they decide on the policies that guide the Bank’s general operations
Responsible for presenting to the Board of Governors, at the Annual Meetings, an audit of accounts, an administrative budget, and an annual report on Bank’s operations and policies as well as other matters
ED’s attend regular Board Meetings twice a week, the EDs also serve on one or more of the five standing committees: Audit Committee, Budget Committee, Committee on Development Effectiveness (CODE), Personal Committee, and Committee on Governance and Executive Directors’ Administrative Matters.

6. The World Bank Group
Cooperative of 185 member countries that are shareholders
Shareholders are represented by Board of Governors
Ultimate policymakers at the WB
Governors are usually Foreign Ministers or Development Ministers
Meet once a year at Annual Meetings of Board of Governors of the WB Group and the IMF
Board of Governors delegate specific duties to the Executive Directors that are ultimately in charge of the WB operations
Five largest shareholders: France, Germany, Japan, UK and US appoint an executive director each
The executive directors are elected by the Board of Governors by 80% majority decision
Executive Directors can be appointed and elected only by International Finance Corporation (IFC) and International Development Association (IDA) members
Members of Multilateral Investment Guarantee Agency (MIGA) Board of Directors are elected separately

7. The World Bank Group Composition
International Bank for Reconstruction and Development (IBRD), December 27, 1945
Original Goal – reconstruction of nations devastated by WWII
Makes loans to governments and private businesses backed by “sovereign” guarantee of repayment
Issues World Bank bonds on capital markets ($12 -$15 billion per year, AAA rated)
International Development Association (IDA), September 24, 1960; 165 member nations
Complements the IBRD by providing poor-income nations with capital investments and advisory services
Provides long-term (35-40 years) debt with lower interest rates to the world’s poorest nations
Due to the abundance of corruption the IDA imposes stricter rules and a watchful eye on all loan contracts
In contrast to IBRD, IDA is funded largely from contributions from member industrialized nations, additionally, from IBRD income and repayment of IDA credits (credits = loans)
Since inception IDA’s credits and grants have total $161 billion
IDA loans promote long-term development and sustainment e.g. primary education, infrastructure, basic health, business climate improvements, and institutional reforms

8. The Challenge To reduce global poverty Mission:
Fight poverty
Provide resources
Share knowledge
Build capacity
Forge partnerships in the private sector
Addressing Global Challenges:
“8 Millennium Development Goals”

9. Global Challenges

10. 8 Millennium Development Goals
Established by UN in 2000
Ambitious targets to halve poverty, fight hunger and disease, and deliver basic services to the poor by 2015
Some of the needs:
Malaria strikes 500 mill. people worldwide each year - $3 bill/yr
Electricity needs - $170 bill/yr over next 10 years + $30 bill/yr transition to low carbon energy mix
Supply water to 1.5 bill. people and provide sanitation to 2 bill. people - $30 bill/yr
Transportation infrastructure - $130 bill/yr
Primary education for 80 mill. out-of-school children - $7 bill/yr

11. Six Strategic Themes
Overcome poverty and spur sustainable growth in the poorest countries (81 countries)
Address special problems of states coming out of conflict or seeking to avoid the breakdown of the state
Create a more differentiated business model for middle income countries
Foster regional and global public goods
Support those seeking to advance development and opportunities in the Arab World
The World Bank – special institution of knowledge & learning

14. Results Tanzania: Credit to private sector increased 250% in 6 years
Poorest countries: 60,000 km of rural roads built, rehabilitated or maintained in the last 5 years
Kazakhstan: after dike helps raise water, fish return to the Aral Sea
Senegal: about 1.6 mill. people have gained access to safe water in urban areas
Bangladesh: stipends help triple girls’ enrollment in secondary school
China: over 3.8 mill. hectares of forests planted
Vietnam: Electricity for 90% of rural households in 2005, up from 50% in 1996
Rwanda: HIV testing for 500,000 people and 12 mill. condoms distributed

15. Financial Crisis: What the World Bank is doing?
March 8, 2009 – Poor countries face $270-$700 billion financing gap
Global Financial Crisis – unemployment crisis
Millions back into poverty and hunger due to recent food and fuel crisis
Tighter credit conditions and weaker growth cut government revenues
Threat to shrink emerging markets’ access to trade and investment
1% drop in growth traps another 20 mill. in poverty

16. Financing
Developed countries to pledge 0.7% of stimulus package to a “Vulnerability Fund”
Increase financial support for developing countries
New commitments of up to $100 bill. over the next 3 years
$1.2 bill. Global Food Response Program (May 2008)
New facility to expedite the approval process to help poorest countries

17. Cont’d Ensure Trade Flows Bolster Distressed Banking Systems
Keep infrastructure projects on track
Shift advisory support services
Support microfinance institutions
MIGA – provides guarantees to foreign banks to help inject liquidity and bolster confidence in Ukraine’s and Russia’s financial systems

18. Trade Borders

19. Advice Providing technical analysis and advice
Crisis preparedness exercises
Development of the Energy for the Poor initiative – helps the poor adjust to shocks and reduce vulnerability to volatile fuel prices

20. Partnerships
Collaboration with IMF and others to help country governments and private sector through lending, equity investments, innovative tools, and safety net programs
The G7 is not adequate – proposing a new broader steering group to address major economic challenges
Seek to strengthen multilateral development institutions to support long-term economic growth

21. World Bank Report 2009

22. References
Financial Crisis
Zoellick, R.B. (2007). Speech: An Inclusive and Substantial Globalization. Retrieved on March 6, 2009 from
Project Lifecycle and Results
ICSID
World Development Report