What is the World Bank or WB? How does it work

 

Located in Washington and directed by Jim Yong Kim, the World Bank defines itself as a cooperative composed of 189 countries around the world . In practice it is an organization that has specialized in the financial assistance of the so-called developing countries.

It was created in 1944 within the framework of the Bretton Woods Agreement that was signed in New Hampshire (United States), an international convention in which the International Monetary Fund (IMF) was also born. The number one goal of the World Bank is to reduce poverty in the world . And to achieve this, it has become the most important lender in the world in development loans.

Who forms the World Bank?

Although originally its purpose was to help European countries in their reconstruction after the end of the Second World War, over the years their functions have expanded so much that they ended up creating more organisms that were integrated into what we know today as The World Bank Group :

  • International Bank for Reconstruction and Development (IBRD) . It is in charge of offering loans and financial assistance to middle-income countries. It was created in 1945 and is made up of 189 countries.
  • International Development Association (AIF) . It is responsible for giving assistance and loans to the poorest countries on the planet. It was created in 1960 and is made up of 172 countries.
  • International Finance Corporation (CFI) . It focuses on private capital and aims to help developing countries by mobilizing capital that will be invested in non-governmental projects. It was created in 1988 and is made up of 184 countries.
  • Multilateral Investment Guarantee Agency (MIGA). Its objective is to promote foreign investment in underdeveloped countries. It was created in 1988 and is made up of 180 countries.
  • International Center for Settlement of Investment Disputes (ICSID) . Its purpose is to provide international conciliation and dispute arbitration services to facilitate foreign investment. It was created in 1966 and is made up of 156 countries.

Together, the World Bank Group has more than 10,000 employees and offices in 109 countries around the world .

Who makes the decisions?

The main decision-making body of the World Bank is the Board of Governors , made up of the finance or development ministers of the member countries. They meet once a year at the Annual Meetings of the Boards of Governors of the World Bank Group and the International Monetary Fund.

The day to day of decision-making falls on the 25 Executive Directors. They all work at the Washington headquarters. France, Germany, Japan, the United Kingdom and the United States each appoint an Executive Director. The remaining 20 Directors choose them among the 184 remaining member countries.