World Bank

The World Bank is actually a group of five intergovernmental organizations that together seek to promote development in the Global South. It is a specialized agency of the United Nations (UN) and its headquarters are in Washington, DC. In recent years, its focus has been on the reduction of poverty. It pursues this agenda through a combination of loans, grants, policy advice, and technical assistance. It is a highly significant actor in the field of development and is involved in projects in almost every developing country in the world. Moreover, its influence is enhanced by the fact that loans made by the World Bank act as a “seal of approval” for other potential lenders and investors in the developing world. The governments of the nationstates that constitute the membership own all five institutions that together are known as the World Bank Group. However, the majority of its finances are raised on international financial markets through the selling of bonds. Voting power of member countries is weighted according to the financial contributions made.

The World Bank is the popular shorthand for the International Bank for Reconstruction and Development (IBRD), which was created at the UN Monetary and Financial Conference held in 1944 at Bretton Woods, New Hampshire. Originally, its mandate was to assist in the rebuilding of those countries that had been devastated by World War II. Actually, this role was mainly performed by the United States through the Marshall Plan because it was decided that in the context of the Cold War, such matters should not be left to a multilateral organization. Then, during the period of decolonization, the attention of the World Bank was diverted toward the developing world. The International Development Association (IDA) was created in 1960 to provide assistance to the world's poorest countries, and, unlike the IBRD, a substantial portion of its resources comes from [Page 1023]donations made by member countries. There are three other arms of the World Bank Group. First, the International Finance Corporation (IFC) provides support for projects in the developing world undertaken by the private sector. Second, the Multilateral Investment Guarantee Agency (MIGA) encourages foreign investment in the developing world by providing risk insurance. Third, the International Centre for Settlement of Investment Disputes (ICSID) also supports the promotion of privately funded foreign investment in the developing world by offering host governments and investors mediation and dispute settlement assistance.