World Bank Group

The World Bank Group (WBG) is a family of five international organizations that make leveraged loans to developing countries. It is the largest and best-known development bank in the world and an observer at the United Nations Development Group. The bank is headquartered in Washington, D.C., in the United States. It provided around $98.83 billion in loans and assistance to "developing" and transition countries in the 2021 fiscal year. Its mission is to end extreme poverty and build shared prosperity.

The World Bank was established along with the International Monetary Fund at the 1944 Bretton Woods Conference. At first, its loans helped rebuild countries devastated by World War II. Over time, it shifted its focus to development. The bank is governed by its 189 member countries, with the United States, as its largest shareholder, traditionally appointing its president. The current president is Ajay Banga, appointed in June 2023.

The Bank provides financing, policy advice, and technical assistance to governments. It also focuses on private sector development through its sister organizations. The Bank's work includes environmental protection, infrastructure, education, health, and climate action. It is also one of the world's largest centers of development research and knowledge, publishing many reports and hosting an Open Knowledge Repository.

The World Bank has faced criticism for the effects of its policies and its governance structure. Some argue that loan conditions in the past harmed social welfare in developing nations. Others criticize the Bank for being dominated by wealthy countries and for its environmental record on certain projects.

History

The World Bank was created in 1944 at the Bretton Woods Conference, along with the International Monetary Fund. Both organizations are based in Washington, D.C., and work closely together.

In its early years, the World Bank made loans mainly for building things like ports, roads, and power plants. Over time, it began focusing more on helping people in developing countries meet their basic needs. This included supporting health, education, and other important services. The bank has grown and changed its focus many times since it began, always aiming to support countries in need.

Membership

Main article: List of World Bank members

The International Bank for Reconstruction and Development (IBRD) includes 189 countries, and the International Development Association (IDA) has 175 members. Every country that joins IBRD must also be part of the International Monetary Fund (IMF). Only IBRD members can join other parts of the World Bank, like IDA. There are five United Nations members that are not part of the World Bank: Andorra, Cuba, Liechtenstein, Monaco, and North Korea. Kosovo is not a UN member but is part of the IMF and the World Bank Group, including IBRD and IDA. Other countries not included are Palestine, the Holy See (Vatican City), and Taiwan, along with several smaller regions.

The Republic of China joined the World Bank on December 27, 1945. After the Chinese Civil War, the government moved to Taiwan and kept its membership until April 16, 1980. After that, the People's Republic of China took over. Since May 2016, all 188 UN members and Kosovo that are part of the World Bank Group also take part in at least one of its other organizations (IDA, IFC, MIGA, and ICSID).

Organizational structure

The World Bank Group is made up of five international organizations that help developing countries with loans. It is the biggest development bank in the world and has its main office in Washington, D.C.. The group is owned by governments of member countries, and any profits are used to support efforts in poverty reduction.

The World Bank Group includes five agencies:

• the International Bank for Reconstruction and Development (IBRD), which gives loans with guarantees,
• the International Finance Corporation (IFC), which gives financing to private businesses,
• the International Development Association (IDA), which offers interest-free loans or grants,
• the International Centre for Settlement of Investment Disputes (ICSID), which helps reduce investment risks,
• the Multilateral Investment Guarantee Agency (MIGA), which provides insurance against certain risks.

The World Bank Group is led by a board of governors, with each member country appointing a governor. Day-to-day operations are managed by a board of executive directors.

Methods

The World Bank helps guide global economic decisions because of its wide reach, many resources, and regular work with governments. In 2020, it committed over 77 billion dollars to help 145 countries. Its projects range from building schools to fighting diseases, providing clean water and electricity, and protecting the environment.

The World Bank works with each country to create a plan that fits their needs, often using research and input from local communities. It also has rules to protect the environment and local communities in its projects. Since 2018, it has used a new framework to guide these protections. The World Bank also works with the United Nations to support sustainable development goals, aiming to reduce poverty and inequality worldwide. During the COVID-19 pandemic, it committed funds to help supply vaccines to lower-income countries.

Response to climate change

See also: Climate finance

In 2012, the World Bank’s leader said that we must work hard to stop the Earth from getting too warm. He explained that doing nothing about climate change could change the world for future generations, especially for those who have the least.

In later years, leaders continued to push for stronger action on climate issues. They wanted to help protect communities that are most affected by changes in the climate. However, some groups felt that more needed to be done to support these efforts fully.

Grants table

The table below shows the top 15 areas where the World Bank has promised money, based on its reports to the International Aid Transparency Initiative. The World Bank says these amounts include all the money from its IBRD and IDA programs, but not money from other sources.

People

Presidents

The president of the World Bank leads the entire World Bank Group. They chair meetings of the boards of directors and manage the bank overall.

Traditionally, the president has been chosen from candidates nominated by the United States, its largest shareholder. The nominee must be confirmed by the board of executive directors for a five-year, renewable term. Most presidents have had banking experience, but some have not.

In 2012, Barack Obama announced that Jim Yong Kim would become the next president. Kim served two terms and resigned in 2019. He was replaced first by Kristalina Georgieva and then by David Malpass. In 2023, Ajay Banga became the new president, supported by Joe Biden for his support of climate action and help for low-income countries with debts. He is the first Indian American to lead the bank.

Vice presidents and boards of directors

Vice presidents manage different regions, sectors, networks, and functions of the bank. There are two executive vice presidents, three senior vice presidents, and 24 vice presidents.

The boards of directors include the World Bank Group president and 25 executive directors. The president leads the meetings and votes only to break a tie. Executive directors can act on behalf of the bank only if specifically authorized by the boards.

Chief economists

Main article: World Bank Chief Economist

Staff

In 2020, the World Bank had about 12,300 full-time staff working in 145 countries.

Politicians who were World Bank employees

Some politicians who worked at the World Bank include:

• Ashraf Ghani, who was Lead Anthropologist at the World Bank and later President of Afghanistan (2014–2021).
• Fakhruddin Ahmed, who was chief adviser of the interim Government of Bangladesh during the political crisis of 2006–2008.
• Ngozi Okonjo-Iweala, former World Bank Managing Director and Minister of Finance of Nigeria.
• Sri Mulyani Indrawati, former World Bank Managing Director and Minister of Finance of Indonesia (2005–2010 & 2016–2025)
• Ellen Johnson Sirleaf, World Bank Director for West Africa and President of Liberia (2006–2018).

List of World Bank Directors-General of Evaluation

Main article: World Bank Director-General Evaluation

• 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)

Criticisms and controversy

The World Bank has faced many criticisms over the years. Groups and experts have pointed out different concerns about how the bank operates. Some believe the policies the bank supports can be harmful if not done carefully, especially in weaker economies.

People also worry about how the bank makes its decisions. Some say the bank’s leadership is controlled by a few powerful countries, which may not always consider the needs of poorer nations. There have been protests around the world against the bank’s actions.

The bank has also been criticized for how it handles money and projects. Some say the bank focuses too much on giving loans and not enough on making sure those loans really help communities. There have been debates about whether the bank’s projects truly reduce poverty or if they sometimes make things worse by increasing government control.

Some critics say the bank’s rules and conditions for giving aid favor the interests of powerful countries and banks, rather than the people who need help the most. There have also been concerns about fairness and transparency in how the bank manages its money and staff.