world bank group

World Bank Group: Fascinating Details You Should Know About!

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What Is The World Bank?

The World Bank Group, an international organization established in 1944, is committed to providing financial and technical assistance to numerous developing countries around the globe. It has around 10,000 employees and 120 offices worldwide. The organization also assists in advancement by fighting poverty and supporting the economic development of the said countries.

The World Bank is the largest funding source for developing countries and it also builds partnerships to increase the development of education, public safety & health, housing, infrastructure, and other areas that require growth.

In spite of its name, the World Bank is not actually a bank. Rather, it comprises two organizations: 

1. International Bank for Reconstruction and Development (IBRD): This organization provides loans, credits, and grants.

2. International Development Association (IDA): This organization works to provide low or no-interest loans to poor or underdeveloped countries.

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What Makes The World Bank So Intriguing?

The following are a few facts that are basic, but many may have never known about them:

  1. The World Bank as an organization was set up 70 years ago and was called The International Bank for Reconstruction and Development.
  2. At present, the World Bank has 189 member countries.
  3. The leading members of the organization are France, Germany, Japan, the U.K., and the U.S.
  4. David Malpass, nominated by Donald Trump in 2019, is the current President of the organization.
  5. The organization’s expenses totaled $60 billion after it made 302 global commitments in the year 2015.
  6. The World Bank has also joined the fight against climate change by supplying funds for increasing the use of renewable energy sources and other improvements.
  7. The World Bank has accomplished 12,411 projects in 173 countries since independence.

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How Does The World Bank Provide Aid?

Everyone knows that the main and most significant function of the World Bank is to provide financial assistance to developing countries, but how does it do it?

world bank

The following are the functions of the organization:

  1. Loans can be granted to the member countries up to 20% of their share in the paid-up capital.
  2. Loans are also granted to the members for a particular project they need financial assistance with after they submit the proposal to the bank.
  3. The World Bank provides loans to underdeveloped or poor countries for the development of agriculture, infrastructure, education, proper water supply, health, and overall safety of the citizens.
  4. It helps in the increment of foreign investment by ensuring the accessibility of loans.
  5. The World Bank also engages in contributing to the private projects of the member countries by offering relevant technical, economic, and monetary advice to them.
  6. The organization sometimes also provides monetary support to the private investors from a member country after they present proof of granted permission by their native country, on its own guarantee.

What Is The Intent Of The World Bank?

 World Bank

After learning the functions of the organization, another vital discussion is about its main goals and targets to assist member countries and put them on the trajectory of technological advancement and overall improvement of the lifestyle of the citizens.

The following are some areas that the organization focuses on:

  1. Providing long-term capital to the member countries for the better economic development of infrastructure in the country.
  2. Promoting capital investment in the countries by providing assurance on private loans or capital investment.
  3. Ensuring the availability of the funds for small and large projects of the member nations.
  4. Maintaining a smooth transition from a war-time to a peace-time situation by ensuring the implementation of progressive projects that will advance the development of the country.
  5. Inducing long-term capital for maintaining BOP equilibrium in order to balance the international trade among different nations.

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What Does The World Bank Exist For?

The World Bank Group has stated “bridging the economic divide between poor and rich countries” as its main purpose. Therefore, it achieves this by transforming the resources of the rich and developed countries into vessels of growth for poor, underdeveloped, and developing countries.

The main duties of the organization are as follows:

  1. To create a pro-investment environment.
  2. To overcome poverty by encouraging growth and development, especially in third-world countries of Africa.
  3. To escalate job opportunities and businesses in poor countries.
  4. To promote equal opportunities in the member countries to reinforce government bodies.
  5. To increase investment in order to promote the improvement of the socio-economic status of the underdeveloped member nations. 

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Sub-Parts Of The World Bank Group

The whole organization is made up of five different organizations, and each of them carries out different operations. These are:

  1. The International Bank for Reconstruction and Development (IBRD)
  2. The International Development Association (IDA)
  3. The International Finance Corporation (IFC)
  4. The Multilateral Investment Guarantee Agency (MIGA)
  5. The International Centre for Settlement of Investment Disputes (ICSID)

The World Bank Group is a widely known organization, but what it actually does or how it carries out its operations are things that are not very well-known or recognized. Through this article, it is very understandable what the organization actually does and which organizations make up the World Bank Group.

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