What is World Bank – The World Bank is a group of some members countries (consider it like a cooperative), formed with an aim of providing finance and technical assistance to developing countries around the world. It is a partnership between the member countries.
Number of Member Countries of the World Bank: Presently there are 189 member countries of the World Bank. To become a member of the World Bank, a country must first become a member of the IMF.
World Bank was formed in 1944.
Headquarters of World Bank:Washington, D.C, US.
The World Bank Group comprises five institutions managed by their member countries. The details of these are given below:
The International Bank for Reconstruction and Development (IBRD)
The IBRD provides loan to governments of the middle-income nation and creditworthy low-income countries.
The International Development Association
The International Development Association (IDA) provides interest-free loans and grants to governments of the poorest countries.
Together, IBRD and IDA make up the World Bank.
Remember: For Poor Country- IDA; For Middle-Income Country- IBRD
The International Finance Corporation
The International Finance Corporation (IFC) is the largest global development institution that focusses on the development of privatesector. Formed in 1956.
The Multilateral Investment Guarantee Agency
The Multilateral Investment Guarantee Agency (MIGA) was created in 1988 to promote foreign direct investment into developing countries to support economic growth, reduce poverty, and improve people's lives. MIGA fulfills this mandate by offering political risk insurance (guarantees) to investors and lenders.
The International Centre for Settlement of Investment Disputes
The International Centre for Settlement of Investment Disputes (ICSID) provides international facilities for conciliation and arbitration of investment disputes.
World Banks goal for 2030
The World Bank Group has set two goals for the world to achieve by 2030:
End extreme poverty by decreasing the percentage of people living on less than $1.90 a day to no more than 3% Promote shared prosperity by fostering the income growth of the bottom 40% for every country
President of World Bank: David R. Malpass (13th President)
Important Reports by World Bank
World Development Report,Ease of Doing Business,Global Economic Prospects International Monetary Fund (IMF)
IMF is an organisation/group of 189 nations that work together to:
to foster global monetary cooperation,secure financial stability,facilitate international trade,promote high employment and sustainable economic growth, andreduce poverty around the world.
Member countries of IMF: There are 189 member countries of IMF.
IMF was formed in 1945.
Headquarters of IMF: Washington, D.C., United States
Managing Director of IMF: Christine Lagarde
Major objective of the International Monetary Fund (IMF)
The main objective of the International Monetary Fund (IMF) is to ensure the stability of the international monetary system. IMF achieves this in three ways:
Economic Surveillance – Keeping track of the global economy and the economies of member countries. The IMF highlights possible risks to stability and advises on needed policy adjustments of its member country. Lending– Lending to countries with balance of payments difficulties. The IMF provides loans to member countries experiencing actual or potential balance of payments problems to help them rebuild their international reserves Capacity Development– Giving practical help to members. The IMF works with governments around the world to modernize their economic policies and institutions, and train their people.
Special Drawing Rights (SDR)– It was created by IMF in 1969 and these are supplementary foreign-exchange reserve assets defined and maintained by the International Monetary Fund.
Important Reports by IMF
Global Financial Stability Report,World Economic Outlook. New Development Bank / BRICS Bank
New Development Bank was established by the BRICS nations of Brazil, Russia, India, China and South Africa with an aim to mobilize resources for infrastructure and sustainable development projects in BRICS economies.
It is also known as BRICS Bank.
Objectives of New Development Bank
The main objectives of NDB operations are:
Fostering development of member countries, Supporting economic growth, Promoting competitiveness and facilitating job creation, Building a knowledge sharing platform among developing countries
Facts about NDB
Initial authorized capital of US$ 100 billion
Formed: July 2014 (Treaty signed); July 2015 (Treaty in force)
Headquarters of New Development Bank: Shanghai, China
President of New Development Bank:K.V. Kamath. Asian Development Bank (ADB)
Asian Development Bank is a regional bank established in 1966 to promote social and economic development in Asia.
Purpose: ADB aims to eradicate extreme poverty in Asia and the Pacific. It assists its members and partners by providing loans, technical assistance, grants, and equity investments to promote social and economic development.
Formed: 19 December 1966
Headquarters of ADB: Manila, Philippines
Members: Presently there are 68 members of ADB (49 are from within Asia and the Pacific and 19 outside.). When ADB was formed in 1966, there were 32 members.
Board of Governors of ADB
Board of Governors is the highest decision-making body of the ADB. It has one representative from each member country. Shri Arun Jaitley is the member from India.
Board of Governors elects a 12 member Board of Directors and a chairperson of Board of Directors, who is also the President of Asian Development Bank (ADB).
President of ADB: Takehiko Nakao (Japan)
Asian Development Fund
Asian Development Fund (ADF) was established in 1974 to provide loans on concessional terms to ADB's lower-income developing member countries (DMCs).
Grants were introduced in 2005.
The main difference between a grant and a loan is that loans are to be repayed while grants are not. Grants are, essentially, a gift. In other words, they're non-repayable.
How is ADF funded
Funds are added to ADF by its members on a rotational basis. For example, for one duration some members will contribute and next time another member will contribute.
ADF resources have been replenished eleven times, the latest being ADF 12 for the period 2017–2020.