Today the focus is on the achievement of the Millennium Development Goals MDGs , goals calling for the elimination of poverty and the implementation of sustainable development.
The constituent parts of the Bank, the IBRD and the IDA, achieve their aims through the provision of low or no interest loans and grants to countries with little or no access to international credit markets. The Bank is a market based non-profit organization, using its high credit rating to make up for the low interest rate of loans.
The Bank's mission is to aid developing countries and their inhabitants achieve the MDGs, through the alleviation of poverty, by developing an environment for investment, jobs and sustainable growth, thus promoting economical growth and through investment in and empowerment of the poor to enable them to participate in development.
The World Bank sees the five key factors necessary for economic growth and the creation of a business environment as:. Capacity Building - Strengthening governments and educating government officials. Infrastructure creation - implementation of legal and judicial systems for the encouragement of business, the protection of individual and property rights and the honoring of contracts. Development of Financial Systems - the establishment of strong systems capable of supporting endeavors from micro credit to the financing of larger corporate ventures.
Combating corruption - Eradicating corruption to ensure optimal effect of actions. Although this does generate some profit, the majority of the IBRD's income is generated from lending its own capital. The IDA obtains the majority of its funds from forty donor countries who replenish the bank's funds every three years, and from loan repayments, which then become available for re-lending.
The Bank offers two basic types of loans; investment loans and development policy loans. The former are made for the support of economic and social development projects, whereas the latter provide quick disbursing finance to support countries' policy and institutional reforms Although the IBRD provides loans with a low interest rate between 0.
The project proposals of borrowers are evaluated for their economical, financial, social and environmental aspects to ensure that they are viable before any amount of money is distributed. The Bank also distributes grants for the facilitation of development projects through the encouragement of innovation, cooperation between organizations and the participation of local stakeholders in projects.
It also provides financing in markets deemed too risky by commercial investors in the absence of IFC participation and adds value to projects. It finances through its corporate governance and environmental and social expertise. To be eligible for IFC financing, projects must be profitable for investors, benefit the economy of the host country, and comply with stringent social and environmental guidelines.
IFC emphasizes five strategic priorities for maximizing its sustainable development impact: Developing domestic financial markets through institution-building and the use of innovative financial products. To ensure participation of investors and lenders from the private sector, IFC limits the finance provided of a project to 25 per cent of total estimated costs; it does not normally hold more than a 35 per cent stake or be the largest shareholder.
For all new investments, the IFC articulates the expected impact on sustainable development, and, as the projects mature, the IFC assesses the quality of the development benefits realized. It addresses concerns about investment environments and perceptions of risk, which often inhibit investment, by providing political risk insurance.
It was established in and presently has members. MIGA also provides advisory services to help countries attract and retain foreign investment, mediates investment disputes to keep current investments intact and to remove possible obstacles to future investment, and disseminates information on investment opportunities to the international business community.
The MIGA provides private investors the confidence and comfort they need to make sustainable investments in developing countries. As part of the World Bank Group, and having shareholders of both host countries and investor countries, the MIGA brings security and credibility to an investment that is unmatched.
The MIGA acts as a potent deterrent against government actions that may adversely affect investments. And even if disputes do arise, leverage with host governments frequently enables resolving differences to the mutual satisfaction of all parties. Infrastructure development is an important priority to deal with rapidly growing urban centres and underserved rural populations in developing countries.
Frontier markets—high-risk and low-income countries and markets—represent both a challenge and an opportunity. These markets typically have the most need and stand to benefit the most from foreign investment, but are not well served by the private market.
Investment into conflict-affected countries is one of the operational priorities of MIGA. While these countries tend to attract considerable donor goodwill, once the conflict ends, aid flows eventually start to decline, making private investment critical for reconstruction and growth.
With many investors wary of potential risks, political risk insurance becomes essential to additional investments.
South-south investments investment between developing countries are contributing a greater proportion of FDI flows. But the private insurance market in these countries is not always sufficiently developed and national export credit agencies often lack the ability and capacity to offer political risk insurance. Founded in , the International Centre for Settlement of Investment Disputes ICSID was designed to facilitate the settlement of investment disputes between foreign investors and host states.
It encourages foreign investment by providing neutral international facilities for conciliation and arbitration of investment disputes, thereby helping foster an atmosphere of mutual confidence between states and foreign investors. The ICSID also conducts research and carries on publishing activities in the areas of arbitration law and foreign investment law.
However, once the parties have consented to arbitration under the ICSID convention, neither can unilaterally withdraw its consent. Since , for providing conciliation and arbitration, the centre has a set of additional facility rules authorizing the ICSID secretariat to administer certain types of proceedings between states and foreign nationals which fall outside the scope of convention. These include conciliation and arbitration proceedings where either the state party or the home state of the foreign national is not a member of the ICSID.
During recent years, the caseload of the ICSID has increased considerably, mainly due to the proliferation of international investment treaties. Institutional Framework for International Trade in India. Essay on International Economic Institutions.
The World Bank was formally established on December 27, , following the ratification of the Breton Woods agreement. The concept was originally conceived in July at the United Nations Monetary and Financial Conference.
Describe in fewer than 1, words your own contribution to these goals, if you were to work for the World Bank Group. Operation Recruitment Stream: Describe your own contribution and the potential role of World Bank in resolving some of the above challenges.
In partnership with the Economic Research Forum, the World Bank in Cairo launched two successful Youth Essay Competitions. The goal was to give young Egyptians the opportunity to develop constructive and innovative solutions for existing development challenges. Essay # 2. The International Bank for Reconstruction and Development: The International Bank for Reconstruction and Development (IBRD) is the oldest of the World Bank Group institutions established in to help Europe recover from the devastation of World War II. Subsequently, it shifted its attention to developing countries.
The World Bank highlighted the need to ensure diversification of the economy to allow equitable growth while reducing the poverty levels. In an effort to ensure that Russia moved with the modern times where globalization is enhanced the World Bank created a 3 year strategy. - Analysis of The World Bank’s Findings on Air Pollution (PM10 Concentration) in World Cities The World Bank is an international non-governmental organization with the goal of aiding developing countries throughout the world with financial and technical assistance.