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World bank


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World bank

  1. 1. World bankNeha Bhartiya (130)Prateek Meharia (138)Punit Rajmohan (140)
  2. 2. WORLD BANK2  International financial institution that provides loans to developing countries for capital programmes  Official goal: Reduction of poverty  Bretton Woods Conference, 1944  Headquarters: Washington DC  Membership: 187 countries  President: Robert B. Zoellick  Parent Organization: World Bank Group World Bank 7/01/2011
  3. 3. WORLD BANK GROUP3 World Bank 7/01/2011
  4. 4. WORLD BANK MISSIONTo fight poverty with passion and professionalismfor lasting results. To help people help themselvesand their environment by providing resources,sharing knowledge, building capacity, and forgingpartnerships in the public and private sectors.
  5. 5. IBRD5  Created December 27, 1945  187 members  Original institution of the World Bank  Largest country membership, the broadest mission, and the greatest number of staff in the Bank Group  First task to help Europe recover from World War II World Bank 7/01/2011
  6. 6. IBRD6  Plays an important role in poverty reduction; provides middle-level and poor credit-worthy countries with loans, guarantees, analytical and advisory services  Supports long term human and social developmental needs that private creditors do not finance  Preserves borrowers’ financial strength by providing support during crisis periods, which is when poor people are most adversely affected  Creates favorable investment climate to catalyze provision of private capital  Provides financial support in the form of grants made available from IBRD’s net income in areas which are critical to the well being of poor people in all countries World Bank 7/01/2011
  7. 7. IDA7  Created September 24, 1960  Provides loans to 81 countries  171 member countries  IDA helps world’s poorest countries reduce poverty by providing credits and grants  IDA’s goal is to reduce disparities across and within countries— especially in terms of access to primary education, basic health, and water supply and sanitation— and to bring more people into the economic mainstream by raising their productivity. World Bank 7/01/2011
  8. 8. IFC Promotes sustainable private sector investment in developing countries Established 1956 182 member countries Member of the World Bank Group Promotes sustainable private sector development by:  Financing private sector projects and companies located in the developing world.  Helping private companies in the developing world mobilize financing in international financial markets.  Providing advice and technical assistance to businesses and governments.
  9. 9. MIGA Founded 1988 Promotes foreign direct investment into developing countries by insuring investors against political risk, advising governments on attracting investment, sharing information through on- line investment information services, and mediating disputes between investors and governments Member of the World Bank Group 174 member countries
  10. 10. International Centre for Settlementof Investment Disputes Established 1966 143 member countries Member of the World Bank Group Provides facilities for the conciliation and arbitration of investment disputes between member countries and individual investors.
  11. 11. Difference between World Bank and IMF11  The World Bank lends only to developing or transition economies, whereas all member countries, rich or poor, can draw on the IMF’s services and resources.  The IMF’s loans address short-term economic problems: they provide general support for a country’s balance of payments and international reserves while the country takes policy action to address its difficulties. The World Bank is concerned mainly with longer-term issues: it seeks to integrate countries into the wider world economy and to promote economic growth that reduces poverty.  The IMF focuses on the macroeconomic performance of economies, as well as on macroeconomic and financial sector policy. The World Bank’s focus extends further into the particular sectors of a country’s economy and Bank work includes specific World its 7/01/2011 development projects as well as broader policy issues.
  12. 12. Millennium Development Goals12  MDGs were endorsed by 189 countries at the September 2000 UN Millennium General Assembly in New York.  MDG’S came out of the agreements and resolutions that have resulted from world conferences organized by the UN in the past 10– 15 years. Each goal is to be achieved by 2015.  Their aim is to reduce poverty while improving health, education, and the environment.  To achieve the MDGs poorest countries require financial aid.  Developing countries may also benefit if trade barriers are lowered, thereby allowing a freer exchange of goods and services. World Bank 7/01/2011
  14. 14. The World Bank’s Finances14 IBRD  IBRD – taps the world’s capital markets  IBRD raises money primarily by selling bonds in international financial markets. It sells AAA-rated bonds and other debt securities to pension funds, insurance companies, corporations, other banks, and individuals around the world  IBRD uses capital from reserves built up over the years and money paid in from the banks 187 member country shareholders  IBRD charges interest to its borrowers at rates that reflect its cost of borrowing. Loans must be repaid in 15 to 20 years, and there is a 3- to 5-year grace period before repayment of principal begins IDA  IDA, the world’s largest source of interest-free loans and grant assistance to the poorest countries, is replenished every three years by donor countries  Provides 35- to 40-year no-interest loans. IDA accounts for nearly 40 percent of World Bank lending  Forty countries contribute to IDA’s funding. Chief donors are France, Germany, Japan, United Kingdom, and the United States World Bank 7/01/2011
  15. 15. World Bank - Profits15  Income used to sustain operating expenses  Some of the surplus goes to IDA  The rest of the surplus is either used for debt relief for heavily indebted poor countries  To meet unseen humanitarian crises  IBRD seeks not to maximize profit but to earn enough income to ensure its financial strength and to sustain its development activities World Bank 7/01/2011
  16. 16. Project Cycle16  The Project Cycle is the framework used by the World Bank to design, prepare, implement and supervise projects  The World Banks public-lending institutions (IDA and IBRD) lend about US$ 15-20 billion annually to 100 countries to Projects ranging from infrastructure, education, health and government financial management World Bank 7/01/2011
  17. 17. Project Cycle17  Pre-Pipeline Studies of development issues carried at the thematic, country and sector level. This is used to improve the Bank’s understanding of development challenges and to promote best practice among staff  Identification The World Bank and borrowing countries jointly identify projects that support their development goals. The identification stage can take up to a year and a half  Preparation The borrowing country is responsible for project preparation. During this stage, which can last up to two years, the borrowing country continues to conduct further studies and impact assessments that includes economic, financial, social and environmental impacts World Bank 7/01/2011
  18. 18. Project Cycle18  Appraisal Appraisal is the sole responsibility of Bank staff. Project Appraisal Document (PAD) is prepared which provides a detail description of the project and its implementation. The Appraisal stage often lasts between 3-6 months  Negotiation and Approval During negotiations, the World Bank and borrowing country will agree on the terms of the loan supporting the project. Typically, negotiations last about 1-2 months  Implementation and Supervision After the loan or credit is approved, the borrowing country can use the funds to purchase the goods and services necessary to meet the project’s objectives. The borrowing country, is responsible for implementing the project. The World Bank’s role is to monitor project implementation to ensure that the terms of the loan/credit agreement are followed and that procurement is conducted according to the World Bank’s guidelines  Evaluation Following completion of the project, the Bank’s Independent Evaluation Group, conducts an audit of the project, where the World Bankoutcome is measured against projects 7/01/2011 its original objectives
  19. 19. Ways of classifying countries19  Low income, Middle and High income Income level of countries average annual per capita low $875 or less lower-middle $876 to $3,465 upper-middle $3,466 to $10,725 High $10,726 or more  Developing and industrial economies: developing low-income or middle- income industrial high-income  Donors and borrowers  Part I, part II: Countries choose whether they are Part I or Part II primarily on the basis of their economic standing World Bank 7/01/2011
  20. 20. Sectors of operation20  Agriculture and rural  Health, nutrition, andnpopulation development  Indigenous peoples  Aid effectiveness  Information and communication technologies  Combating corruption  Infrastructure  Conflict prevention and  Labour and social protection  fragile states  Law, regulation, and the judiciary  Debt relief  Manufacturing and services  Economic research and  Poverty  data  Private sector development  Education  Social development  Empowerment and participation  Sustainable development  Energy and mining  Trade  Environment  Transport  Financial sector  Urban development  Gender  Water  Globalization  Governance World Bank 7/01/2011
  21. 21. Initiatives21 Multilateral Debt Relief Initiative (MDRI) • To cut the debt burdens of many of the world’s poorest countries to acceptable levels. Total debt relief under the MDRI is estimated at about $50 billion(2008) Low-Income Countries Under Stress (LICUS) Initiative • Which recommends ways to help countries with particularly weak policies and institutions get onto a path of sustained growth and poverty reduction by improving the effectiveness of development aid Education for all fast track initiatives • The initiative’s goal is to accelerate progress toward achievement of the MDGs for education. It is open to all low-income countries that demonstrate a serious commitment to achieving universal primary education World Bank 7/01/2011
  22. 22. IDA Lending22 World Bank 7/01/2011
  23. 23. WORLD BANK IN INDIA23 Infrastructure • Mumbai Urban Transport Project (MUTP) • Rural roads • Building state highways in A.P. Rural development • Empowering the poor in Tamil Nadu • Reclaiming saline lands in UP • Improving agriculture in Assam • Reversing the degradation of natural resources in lower Himalayas • Rural water supply and sanitation Creating jobs Health • Eliminating leprosy • Controlling T.B . • Reconstruction World Bank 7/01/2011
  24. 24. WORLD BANK IN INDIA24 • North east rural livelihood project(NERLP)(20-dec-2011) • Uttar Pradesh Health Systems Strengthening Projects (UPHSSP)(20- dec-2011) • Rampur Hydropower project- carbon finance (6th oct 2011) • Capacity Building for Urban Local Bodies-NURM (21st July 2011) • West Bengal Accelerated development of Minor Irrigation (24th Oct 2011) • Karnataka State Highway Improvement (24th March 2011) • National Ganga River Basin Project(31-may-2011) • Rajasthan Rural Livelihood Project – RRLP (11th Jan 2011) World Bank 7/01/2011
  25. 25. Current Lending by Sector in Number of Projects - India25 Year 2011 World Bank 7/01/2011
  26. 26. Lending in Millions of US Dollars to26 India World Bank 7/01/2011
  27. 27. IDA – INDIA FUNDINGSarva Shiksha Abhiyan or SSA In 2002 India unveiled its national flagship program, the Elementary Education Project (Sarva Shiksha Abhiyan or SSA), financed by the International Development Association (IDA). IDA is the single largest donor. IDA’s SSA I project (2004 to 2007) contributed US$500 million of the program’s total cost of US$3.5 billion. In May 2008, SSA II was approved with an IDA commitment to provide an additional US$600 million to the program, In March 2010, following the Government of India’s decision to extend SSA II for another two years, additional IDA funding of US$750 million was approved for 2010-12 With SSA having made great strides in increasing access to primary education, the focus is now on bringing the remaining 8.1 million out-of-school children into school, boosting provision of upper- primary educational facilities, and improving learning outcomes
  28. 28. IDA – INDIA FUNDINGBhoomi Project – IDA funded project Deals with computerization of 20 million records of land ownership It will benefit nearly seven million rural farmers by allowing them to transfer land titles online. The project has reduced corruption and saved time and costs.
  29. 29. Impact of World Bank29  During the past 40 years, life expectancy in developing countries has risen by 20 years—about as much as was achieved in all of human history prior to the mid-20th century.  During the past 30 years, adult illiteracy in the developing world has been nearly halved to 25 percent.  During the past 20 years, the absolute number of people living on less than US$1 a day has begun to fall for the first time, even as the worlds population has grown by 1.6 billion people.  During the last decade, growth in the developing world has outpaced that in developed countries, helping to provide jobs and boost revenues poor countries governments need to provide essential services. MNEs  MNEs prefer World bank funded projects rather than country funded projects World Bank 7/01/2011
  30. 30. 30 FEEDBACK World Bank 7/01/2011