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World Bank

The World Bank aims to promote long-term foreign investment loans on reasonable terms to assist in the reconstruction and development of member countries. Specifically, its objectives are to facilitate investment for productive purposes, promote private investment, supplement private investment when capital is unavailable, promote long-term balanced trade growth, arrange international loans to prioritize useful projects, and assist countries transition from wartime to peacetime economies. The World Bank focuses on human development, agriculture, environment, infrastructure, and governance in developing nations through loans and grants.

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62 views2 pages

World Bank

The World Bank aims to promote long-term foreign investment loans on reasonable terms to assist in the reconstruction and development of member countries. Specifically, its objectives are to facilitate investment for productive purposes, promote private investment, supplement private investment when capital is unavailable, promote long-term balanced trade growth, arrange international loans to prioritize useful projects, and assist countries transition from wartime to peacetime economies. The World Bank focuses on human development, agriculture, environment, infrastructure, and governance in developing nations through loans and grants.

Uploaded by

Hemant Mishra
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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What are the objectives of world bank?

The term "World Bank" generally refers to the IBRD and IDA, whereas the World Bank Group is used to refer to the institutions collectively.[2]

The World Bank's (i.e. the IBRD and IDA's) activities are focused on developing countries, in fields such as human development (e.g. education, health), agriculture and rural development (e.g. irrigation, rural services), environmental protection (e.g. pollution reduction, establishing and enforcing regulations), infrastructure (e.g. roads, urban regeneration, electricity), and governance (e.g. anti-corruption, legal institutions development). The IBRD and IDA provide loans at preferential rates to member countries, as well as grants to the poorest countries. Loans or grants for specific projects are often linked to wider policy changes in the sector or the economy. For example, a loan to improve coastal environmental management may be linked to development of new environmental institutions at national and local levels and the implementation of new regulations to limit pollution.

Objectives of World Bank


The World Bank was established to promote long-term foreign investment loans on reasonable terms. The, purposes of the Bank, as set forth in the 'Articles of Agreement are as follows: (i) To assist in the reconstruction and development of territories of members by facilitating the investment of capital for productive purpose including; (a) the restoration of economies destroyed or disrupted by war; (b) the reconversion of productive facilities to peaceful needs; and (c) the encouragement of the development of productive facilities and resources in less developing countries; (ii) To promote private investment by means of guarantee or participation in loans and other investments made by private investors. (iii) When private capital is not available on reasonable terms, to supplement private investment by providing on suitable conditions finance for productive purpose out of its own capital funds raised by it and its other resources. (iv) To promote the long-range balanced growth of international trade and the maintenance of equilibrium in balances of payments by encouraging international investment for the development of the productive resources of members, thereby assisting in raising productivity, the standard of living, and conditions of labour in their territories. (v) To arrange the loans made or guaranteed by it in relation to international loans through other channels so that the more useful and urgent projects, large and small alike, will be dealt with first.

(vi) To conduct its operations with due regard to the effect of international investment on business conditions in the territories of members and in the immediate postwar years, to assist in bringing about a smooth transition from a wartime to peacetime economy.

World Bank Functions


The World Bank is one of the Bretton Woods institutions. The group, which consists of the World Bank and the International Monetary Fund, is named for the city of Bretton Woods, New Hampshire, where they were created at a 1944 summit between representatives from the United States, the United Kingdom, Australia and India. The World Bank promotes the original purpose of the decisions made at Bretton Woods: the facilitation of the international economy.

1. Lending
o

The World Bank was established at Bretton Woods because the end of World War II was in sight and the summit attendees worried about the devastation of Europe. The Bank was created to help with reviving Europe's economy and repairing the damage of the war. It did this by giving loans -- its first loan, in 1947, gave $250 million to France to rebuild. As of 2010, the bank loaned about $13 billion each year to developing countries in the form of interest-free credits.

Development Strategy
o

Loans from the World Bank have strings attached: the Bank monitors how each country spends the funds that it receives. The framework of the World Bank provides support for countries to which it lends to ensure that World Bank funds are not spent inefficiently or lost to corruption. The Bank studies the economy and political atmosphere of each country to which it intends to lend funds. The loan comes with a development strategy that the various institutions that comprise the World Bank will help the country follow.

Financial Services
o

The World Bank also helps developing countries to manage their money effectively. As part of its development strategies, the World Bank counsels the borrowing countries on developing their financial strategies. It helps them to develop their investment portfolios and teaches them about financial practices like risk management through hedging and derivatives trading. It gives continuing financial advice to its borrowing countries, advising them on managing investments and risk in addition to protecting against disasters with catastrophe bonds.

Data Collection
o

The World Bank draws on the experiences of countries that it has supplied funds to in the past to decide how a new borrower may best use its loan. It documents its experiences in data banks. The World Bank collects information about each borrowing country and how it uses World Bank funds. While the Bank collects this information primarily for its own use, it also shares its knowledge. The World Bank makes much of its data available to the public in online databases, and it also publishes its analysts' reports on emerging global trends.

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