The World Bank

THE WORLD BANK

In 1944, Western powers were determined to prevent any re-emergence of the economic depression which had dominated the 1930s, and which played a big part in bringing about the second World War. In the last year of the devastation of that war, priority had to be given to re-establishing the European countries economically.

The World Bank (WB) was conceived in 1946 during the World War II at Bretton Woods, New Hampshire. The Bank was initially founded to help rebuild Europe after the war. The first loan of $250 million was granted to France in 1947 for post-war reconstruction. The Bank was mainly designed by the U.S. government officials and is physically based in Washington. The Bank's President has always been an American. From the beginning the Bank was intended to counter protectionism and economic depression.

Today, the World Bank itself is bigger and broader and far more complex. Some 6800 staff are currently based in Washington. It has become a Group, encompassing five closely associated development institutions.

Together with the International Monetary Fund (IMF), it now affects every country in the world. Those in richer countries contribute through taxes and more than half of the countries in the world borrow extensively.

The World Bank is made up of two unique development institutions owned by 184 member countries Ð'- the International Board Reconstruction and Development

( IBRD) and the International Development Association ( IDA). Each financial institution plays a different but supportive role in their mission of global poverty reduction and the improvement of living standards. The IBRD focuses on middle income and creditworthy poor countries, while IDA focuses on the poorest countries in the world. Unlike any other financial institutions, World Bank does not operate for profit.

The World Bank is like a cooperative, where its member countries are shareholders. The share holders are represented by a Board of Governors. The Governors are member countries' ministers of finance. Mr. Paul Wolfowitz is the present President of the World Bank.

The World Bank is a vital source of financial and technical assistance to developing countries around the world. The World Bank is not a bank in the common sense. The Bank provides low Ð'- interest loans, interest Ð'- free credit and grants to developing countries for education, health, infrastructures, communication and many other purposes.

The World Bank has a multidisciplinary and diverse staff including economists, public policy experts, sectoral experts and social scientists. Forty percent of staff are now based in country offices.

The organizations that make up the World Bank Group are owned by the governments of member nations, which have the ultimate decision-making power within the organizations on all matters, be they policy, financial, or membership issues.

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