The World Bank (WB) is a multinational corporation aiming at the alleviation of poverty. It facilitates various economies of the world in following sustainable economic growth. The World Bank was formed in 1944 as a part of the Bretton Woods system for reconstructing countries devastated during WW-II.
The World Bank comprises of the following two institutions:
International Bank for Reconstruction and Development: The IBRD focuses on low-income economies that have little access to global credit markets.
International Development Association: The IDA focuses on helping the poorest nations.
World Bank: How it Works
At present, the main task of the World Bank is to achieve its Millennium Development Goals:
- Elimination of poverty and hunger
- Achieving worldwide primary education
- Empowering women
- Reduction in child mortality
- Improving maternal health
- Fighting against diseases, such as AIDS and malaria
- Environmental sustainability
- Forming a global partnership for growth
The World Bank earns funds through bonds traded in the financial market, interest received on loans and funds provided by developed nations. The bank offers financial and technical assistance based on its Six Strategic Themes:
- The poorest nations
- Fragile states
- Middle income nations
- Global public goods
- The Arab world
- Learning and education
The bank provides loans for social and economic growth and investment loans as financial aid for institutional reforms. It also provides grants and advisory services to developing nations. The World Bank provides analysis reports to members on poverty assessments, sector reports, country economic reports and public expenditure reviews.
Achievements of the World Bank
Here are some of the achievements of the World Bank:
- The Indigenous Knowledge (IK) Project has achieved remarkable success in bank-supported projects, building partnerships, increasing capacity through peer-to-peer exchanges and mainstreaming IK in growth.
- The successful implementation of the World Bank Loan Project from 1992 to 2000 on schistosomiasis control.
- Global actions promoted by the bank have helped in combating diseases, such as river blindness and smallpox. Also, new problems, such as the depletion of the ozone layer, have been addressed.
Challenges of the World Bank
The World Bank faces the following challenges:
- Income inequality is still rising with the richest countries earning 37 times more average income than the poorest nations.
- Deforestation is increasing considerably.
- The uniform approach implemented by the bank for both the developed and underdeveloped nations has been criticized by many. Developing countries are not in favor of losing their traditional life style to modernization.
- Improved standard of living and productive work for the globally increasing population.
The World Bank has 185 member nations. Since the United States has been the key player of the organization, the WB President has always been an American.