World Bank: What it is, Goals and MORE

7 minutos de lectura

The World Bank, also know as International Bank for Reconstruction and Development -BIRF-, is an organization that is part of the United Nations. And, it is made up of more than 180 member countries.

For this reason, in this article we dedicate ourselves to explain in depth: origin of the World Bank, what it is, its objectives or purposes, who makes it up, and we culminate in the development of the bank’s role vis-à-vis the countries.

Origin of the World Bank

Well, to begin with, it is up to us to clarify that, World Bank was created in 1994 on the basis of the Bretton Woods agreement. This agreement was guaranteed under the recommendation of the United Nations in the last days of the Second World War.

Likewise, we must mention that said agreement contained various components, among them was: the formation of the World Bank, a collective international monetary system, and finally the creation of the International Monetary Fund (IMF).

Since its founding, both the International Monetary Fund like the World Bank itself, have worked together to achieve your goals. In fact, one of the purposes they maintained was to provide support to European and Asian countries.

However, El Nixon, former president of the United States of America, disrupted Bretton Wood’s international monetary system in the 1970s. But both the International Monetary Fund and the World Bank remained open.

The World Bank and the International Monetary Fund – IMF – have their headquarters in Washington, DC. And, today, the organization has more than 9,000 employees in more than 110 offices around the world.

On the other hand, it is up to us to clarify an important aspect. And it is that, the counterpart of the World Bank, that is to say the International Monetary Fund-IMF-, is structured more like a credit fund. This allows them to offer different types of loans and financial support.

Likewise, we must emphasize that each of these entities have several of their own responsibilities in terms of serving the economy.

What is it?

Once the explanation of the origin of the bank is completed, it is up to us to give continuity to this report by developing what is he world Bank. Highlighting in turn that, this bank is also known as Birf -International Bank for Reconstruction and Development-.

Now, as we have mentioned in the previous point, this bank is basically an organization that It is part of the United Nations. And the same, It is made up of more than 180 member countries, and has more than 9,000 employees.

On the other hand, this bank is headquartered in Washington, United States. In addition, it has more than 9,000 employees in its more than 110 offices around the world. Likewise, we can highlight that this bank has various objectives, the main ones being:

  • Minimize poverty and inequality.
  • Provide credit for development projects.
  • Finance programs for: hunger, infrastructure projects, education, among others.
  • Promote shared prosperity.

It should be noted that this bank is considered the world’s largest source of development assistance. Title obtained for having released more than $ 50 billion every year in grants and loans to the more than 180 member countries.

The World Bank is one of the most important sources of financing and knowledge for all those developing countries. In fact, it is made up of 5 institutions committed to minimizing poverty, increasing prosperity and promoting development.

Presidency of the World Bank

However, the president of the International Bank for Reconstruction and Development -BIRF- is traditionally a US citizen. And, on the other hand, the president of the International Monetary Fund (IMF) is traditionally European.

However, in the latter there was an exception with the American citizen Anne Kruege, which held the position in the International Monetary Fund-IMF- until a new director was appointed. Exceptionally, on July 1, 2012, South Korean Jim Yong Kim took office.

Name

Year Nationality
Eugene meyer

John J. McCloy

Eugene R. Black, Sr.

George Woods

Robert McNamara

Alden W. Clausen

Barber conable

Lewis T. Preston

Sir James Wolfensohn

Paul Wolfowitz

Robert Zoellick

Jim Yong Kim

David malpass

1946–1946

1947–1949

1949–1963

1963–1968

1968–1981

1981–1986

1986–1991

1991–1995

1995–2005

2005–2007

2007–2012

2012–2019

2019 – present

USA

USA

USA

USA

USA

USA

USA

USA

USA

USA

USA

USA

USA

objectives

In another vein, it is convenient to make space to list the different objectives that the International Bank for Reconstruction and Development -BIRF- has for the global benefit. However, we will only mention some of them below:

End extreme poverty
  • In this sense, they seek to minimize to 3% the percentage of all citizens who live on less than $ 1.90 a day in the world by 2030 at the latest.
Promote shared prosperity
  • In this way, they seek to promote an increase in the income of the poorest 40% of the population in all countries.

In addition to all of the above, another of the bank’s objectives is to provide loans, guarantees, risk management products and services, and offer financial products and policy advice to help countries minimize poverty.

It is important to highlight that, since 1994, the International Bank for Reconstruction and Development -BIRF- has financed more than 11,000 development projects. This, thanks to traditional loans, interest-free credits and donations.

Who makes it up?

The World Bank is made up of 189 member countries, has staff in more than 170 countries, and offices in more than 120 locations. In turn, it is a unique global association.

Likewise, we must mention that the five institutions that make up said bank work together to achieve its objectives. Among which is: minimize or reduce poverty, generate prosperity in developing countries, among others.

On the other hand, and as we have already mentioned, the International Bank for Reconstruction and Development -BIRF-, It has more than 170 member countries. And, on the other hand, the International Development Association -AIF-, It has more than 160 members.

However, and based on what is stated in the previous text, we must clarify an important aspect. And it is that, each State that is part of the International Bank for Reconstruction and Development -BIRF-, must also be a member of the International Monetary Fund -IMF-.

All those who are part of the International Bank for Reconstruction and Development -BIRF-, are authorized to join other Bank institutions, such as: IDA.

Voting Power

In 2010, a review of voting power was made at the International Bank for Reconstruction and Development -BIRF-, to increase the voice of developing countries, especially China. However, The countries that currently have the most voting power are:

  1. United States (15.85%).
  2. Japan (6.84%).
  3. China (4.42%).
  4. Germany (4.00%).
  5. United Kingdom (3.75%) France (3.75%).
  6. India (2.91%).

On the other hand, and based on the changes produced and known as Voice Reform – Phase 2, other countries that managed to obtain important and significant gains are included: South Korea, Turkey, Mexico, Singapore, Greece, Brazil, India and Spain.

The voting power of most developed countries was reduced. While, in countries like: USA, Russia, Saudi Arabia and Nigeria, they did not change their voting power.

Now, it should be noted that these changes were carried out in order to make voting more universal in relation to the rules already pre-established and fixed. Which was based especially on rules with objective and transparent indicators, among other things.

Role of the World Bank vis-à-vis the countries

To end this article, it is up to us to capture detailed and in-depth information about the role of the International Bank for Reconstruction and Development -BIRF- in front of the different and numerous countries. Emphasizing in turn that it has several important roles.

First of all, we must mention that the International Bank for Reconstruction and Development -BIRF- provides technical and financial assistance to all the countries of the world. In addition, it is considered as a single financial body that establishes partnerships to:

  1. Reduce or eliminate poverty in the countries of the world.
  2. Provide support and support regarding their economic development.

In addition to the above, the International Bank for Reconstruction and Development -BIRF- provides those governments that meet the necessary requirements low-interest loans, grants and interest-free credits, to support the development of the individual economy.

In addition to this, we must emphasize that, said loans and infusions of money they are the ones that help world education, public administration, health care, infrastructure and development in the private sector.

The International Bank for Reconstruction and Development -BIRF-, shares information with different entities through regulatory advice, research and analysis, and technical assistance.

Now, it is important that we emphasize a relevant aspect about this entity. And, although it has the right to be a bank, the International Bank for Reconstruction and Development -BIRF-, it is not necessarily one in the traditional sense of the word.

This is because it and its subsidized groups operate within its facilities, and develop their own proprietary financial assistance products. However, they do all this with the sole objective of meeting the capital needs of the countries.

To end our writing, we invite you to help us share the information.

See you soon!

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