IBRD
The IBRD was founded in 1944 with the goal of helping war-torn European countries rebuild
their infrastructure and their economies. Following the recovery from World War II, the
International Bank of Reconstruction and Development broadened its mandate to increasing
global economic growth and eliminating poverty.
The World Bank is like a cooperative, made up of 189 member countries. These member
countries, or shareholders, are represented by a Board of Governors, who are the ultimate
policymakers at the World Bank. Generally, the governors are member countries' ministers of
finance or ministers of development. They meet once a year at the Annual Meetings of the
Boards of Governors of the World Bank Group and the International Monetary Fund.
IBRD finances investments across all sectors and provides technical support and expertise at
each stage of a project. IBRD’s resources not only supply borrowing countries with needed
financing, but also serve as a vehicle for global knowledge transfer and technical assistance.
The IBRD advises countries that are interested in limiting poverty and enabling sustainable
development. Its main focus is on providing financing and economic policy advice to help the
leaders of middle-income countries navigate the path toward greater prosperity.
Article I: Purposes
The purposes of the Bank are:
(i) To assist in the reconstruction and development of territories of members by facilitating
the investment of capital for productive purposes, including the restoration of economies
destroyed or disrupted by war, the reconversion of productive facilities to peacetime needs
and the encouragement of the development of productive facilities and resources in less
developed countries.
(ii) To promote private foreign investment by means of guarantees or participations in loans
and other investments made by private investors; and when private capital is not available on
reasonable terms, to supplement private investment by providing, on suitable conditions,
finance for productive purposes out of its own capital, funds raised by it and its other
resources.
(iii) 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 labor in their territories.
(iv) 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.
(v) 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 a peacetime economy.
Objectives of World Bank
Providing member countries with long-term capital for economic reconstruction and
development
Inducing long-term capital investment to ensure a balanced development of BOP
balance and international trade.
Promote capital investment in member countries in the following ways.
1. To provide a guarantee on capital investment or private loans.
2. If capital is not available even after the guarantee has been provided, IBRD will
provide credit for production activities on favourable terms.
Ensuring the implementation of development projects to bring about a smooth
transition from wartime to a peaceful economy.
World Bank
Over the years, the World Bank has evolved from a single institution to a group of five
unique and collaborative institutions, known collectively as the World Bank or the World
Bank Group. The first organization is the International Bank for Reconstruction and
Development (IBRD), an institution that funds government debt in middle-income countries.
The second organization within the World Bank Group is the International Development
Association (IDA), a group that provides interest-free loans to governments in poor countries.
The third organization, the International Finance Corporation (IFC), focuses on the private
sector and provides investment finance and financial advisory services to developing
countries. The fourth branch of the World Bank Group is the Multilateral Investment
Guarantee Authority (MIGA), an organization that encourages foreign direct investment in
developing countries. The fifth organization is the International Centre for Settlement of
Investment Disputes (ICSID), which provides arbitration for international investment
disputes.
Organization associated with the World Bank
The World Bank Group consists of five international organizations that provide financing to
developing countries. They 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).
IBRD and IDA are sometimes collectively referred to as the World Bank. The IBRD has 189
member countries and the IDA has 173 member countries.
Function of the world Bank
The World Bank supports countries devastated by the war by providing loans for
reconstruction.
They provide a wealth of experience and the World Bank’s financial resources help
poor countries promote economic growth, reduce poverty and achieve better living
standards.
They also support developing countries by providing development loans.
The World Bank also lends to various governments for irrigation, agriculture, water
supply, health and education.
Encourage foreign investment in other organizations by guaranteeing loans.
The World Bank also provides member countries with financial, financial and
technical advice on all projects.
In this way, by introducing various economic reforms, we are promoting the
development of industries in developing countries.
Conclusion
The World Bank, or World Bank Group, is an international organisation linked with the
United Nations (UN) that finances programmes that help member countries grow their
economies. The bank, which is headquartered in Washington, D.C., is the world’s largest
provider of financial aid to poor countries. It also provides technical support and policy
advice, as well as oversees the implementation of free-market reforms on behalf of
international creditors. It has a key role in regulating economic policy and modernising public
institutions in developing nations, as well as establishing the global macroeconomic agenda,
alongside the International Monetary Fund (IMF) and the World Trade Organization.
