A non-profit group, owned by its member countries, that provides loans, technical assistance, and policy advice to more than 100 developing countries. Aid from the World Bank helps these countries improve their living standards by fighting poverty, improving health care and education, and protecting the environment. During its fiscal year 2002, more than $19.5 billion dollars in loans was provided to countries. The World Bank was founded in 1944 and is owned by more than 184 member countries that are represented by a Board of Governors and a Washington-based Board of Directors. The president of the bank is typically a citizen of the largest shareholder, the United States. The president is elected for a five-year renewable term. The president runs meetings of the Board of Executive Directors and is responsible for the overall management of the World Bank.
The World Bank is actually comprised of five distinct institutions.
The International Development Association helps the world’s poorest countries reduce poverty by giving them credits, which are loans at zero interest that have a 10-year grace period and maturities of 35 to 40 years.
The International Bank for Reconstruction and Development (IBRD) provides loans and development assistance to middle-income countries and poorer countries that are creditworthy. Typically, IBRD is the name that is most commonly used in Europe, instead of saying World Bank.
The International Finance Corporation (IFC) promotes private sector investment, either foreign or domestic, in developing member countries. Its investment and advisory activities are intended to reduce poverty and improve people’s lives in an environmentally and socially responsible manner.
The Multilateral Investment Guarantee Agency (MIGA) promotes growth in emerging economies by promoting foreign direct investment. To do this, it offers guarantees to investors and lenders in order to protect them against political risk.
The International Centre for Settlement of Investment Disputes (ICSID) provides methods to resolve investment disputes between foreign investors and their host countries through arbitration or conciliation.
In 1996, the World Bank and the Inter-national Monetary Fund (IMF) launched the Heavily Indebted Poor Countries (HIPC) Initiative to create a framework for all creditors, including multilateral creditors, to provide debt relief to the world’s poorest and most heavily indebted countries, and thereby reduce the constraint on economic growth and poverty reduction imposed by the debt build-up in these countries.
The World Bank holds its annual meeting during the fall, at the same time the International Monetary Fund holds its annual meeting. Traditionally, the annual meetings are held in Washington, D.C. during two years out of three. In the third year the meeting is held in a different country. About 10,000 people attend the meetings, including about 3,500 members of delegations from the member countries of the Bank and the IMF, roughly 1,000 representatives of the media, and more than 5,000 visitors and special guests drawn primarily from private business, the banking community and non-governmental organizations (NGOs). A similar, but smaller meeting also is held in the spring.