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History of World Bank in Chronological Order


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3 4-5 6-9

4 5 6 7 9 10 11 12

10-12 13-17 18-19 20-22 23-26 27-28 29-31 32

INTRODUCTION:The World Bank is a lending institution that funds essential infrastructural requirement, globally. Headquartered in Washington D.C., this fiscal institution is banked upon heavily by the governments of the world for timely dispensing of funds to support the development of major utilities and services. The current 'green' focus of the World Bank has taken the 1944 initiative to a new level. The World Bank is the outcome of the Bretton Woods Conference, held in 1944. It was launched alongside the International Monetary Fund, in the presence of a number of important world delegates, and many important policy makers from the United States of America and Britain. Initially, till 1968 the World Bank mainly lent money, following fiscal conservatism. Loan applications were very carefully screened.

HISTORY:The World Bank Group Historical Chronology provides a comprehensive timeline of key events in World Bank Group history. Since its inception in 1944, the World Bank expanded from a single institution to an associated group of co-ordinated development institutions. The Bank's mission evolved from a facilitator of post-war reconstruction and development to its present day mandate of worldwide poverty alleviation. Whereas heavy infrastructure investment projects once dominated the Bank's portfolio, a broadened focus now includes social sector lending projects, poverty alleviation, and the Comprehensive Development Framework. The World Bank Group Historical Chronology highlights these changes in the institution's history. Many of the items in the Chronology are "firsts", documenting the first occurrence of significant events, such as the first lending for each member country, the first meetings of consultative groups, first lending in a particular sector, etc. The chronology also includes membership dates for all member countries in each institution within the World Bank Group.

Definition of World Bank:The definition of the World Bank specifies: A bank with a mission to aid developing and under-developed nations of the world to:
y y y y y y y y y y

Reduce poverty. Develop an investment-environment. Increase job opportunities. Work towards sustainable economic growth. Promote socio-economic growth through investment. Strengthen governments with education. Empower the development of legal and judicial systems, business opportunities and protection of individual rights. Benefit from micro credit as well as large corporate undertakings. Combat corruption. Promote research and training opportunities.

Facts About World Bank:World Bank offers two types of loans: investment and development policy. While investment loans are those that are forwarded to support economic and social development, development policy loans are offered as quick finance to support institutional reforms to reduce third world debt. The Bank provides analytical services for economic and social infrastructural improvements. It also encourages innovation and cooperation between local stakeholders to generate:
y y y y

Debt relief in the case of very poor countries. Development of sanitation and water supply. Support immunization programs during epidemics. Create 'green' initiatives.

The current president of the World Bank is Robert B. Zoellick. He is assisted by 3 senior Vice Presidents, 24 Vice-Presidents and 2 Executive Vice Presidents.

Organizational Structure
Together with four affiliated agencies created between 1956 and 1988, the IBRD is part of the World Bank Group. The Group's headquarters are in Washington, D.C.. It is a non-profit-making international organization owned by member governments. Technically the World Bank is part of the United Nations system, but its governance structure is different: each institution in the World Bank Group is owned by its member governments, which subscribe to its basic share capital, with votes proportional to shareholding. Membership gives certain voting rights that are the same for all countries but there are also additional votes which depend on financial contributions to the organization. As a result, the World Bank is controlled primarily by developed countries, while clients have almost exclusively been developing countries. Some critics argue that a different governance structure would take greater account of developing countries' needs. As of November 1, 2004 the United States held 16.4% of total votes, Japan 7.9%, Germany 4.5%, and the United Kingdom and France each held 4.3%. As major decisions require an 85% super-majority, the US can block any change.


From 1989 World Bank policy changed in response to criticism from many groups. Environmental groups and NGOs were incorporated in the lending of the bank in order to mitigate the effects of the past that prompted such harsh criticism. Bank projects "include" green concerns.

The World Bank headquarters in Washington, D.C. Millennium Development Goals

The World Bank's current focus is on the achievement of the Millennium Development Goals (MDGs), lending primarily to "middle-income countries" at interest rates which reflect a small mark-up over its own (AAA-rated) borrowings from capital markets; while the IDA provides low or no interest loans and grants to low income countries with little or no access to international credit markets. The IBRD is a market-based nonprofit organization, using its high credit rating to make up for the relatively low interest rate on its loans, while the IDA is funded primarily by periodic "replenishments" (grants) voted to the institution by its more affluent member countries. The Banks mission is to aid developing countries and their inhabitants to achieve development and the reduction of poverty, including achievement of the MDGs, by helping countries develop an environment for investment, jobs and sustainable growth, thus promoting economic growth through investment and enabling the poor to share the fruits of economic growth.

In 1980 A.W. Clausen replaced McNamara after being nominated by US President Jimmy Carter. Clausen replaced a large number of bank staffers from the McNamara era and instituted a new ideological focus in the bank. The replacement of Chief Economist Hollis B. Chenery by Anne Krueger in 1982 marked a notable policy shift at the bank. Krueger was known for her criticism of development funding as well as third world governments as rent-seeking states. Lending to service third world debt marked the period of 19801989. Structural adjustment policies aimed at streamlining the economies of developing nations (at the expense of health and social services) were also a large part of World Bank policy during this period. UNICEF reported in the late 1980s that the structural adjustment programs of the World Bank were responsible for the reduced health, nutritional and educational levels for tens of millions of children in Asia, Latin America, and Africa.

From 1968 to 1980 the bank concentrated on meeting the basic needs of people in the developing world. The size and number of loans to borrowers was greatly increased as loan targets expanded from infrastructure into social services and other sectors. These changes can be attributed to Robert McNamara who was appointed to the presidency in 1968 by Lyndon B. Johnson. McNamara imported a technocratic managerial style to the Bank that he had used as United States Secretary of Defense and President of the Ford Motor Company. McNamara shifted bank policy toward measures such as building schools and hospitals, improving literacy and agricultural reform. McNamara created a new system of gathering information from potential borrower nations that enabled the bank to process loan applications much faster. To finance more loans, McNamara told bank treasurer Eugene Rotberg to seek out new sources of capital outside of the northern banks that had been the primary sources of bank funding. Rotberg used the global bond market to increase the capital available to the bank. One consequence of the period of poverty alleviation lending was the rapid rise of third world debt. From 1976 to 1980 developing world debt rose at an average annual rate of 20%.

From its conception until 1967 the bank undertook a relatively low level of lending. Fiscal conservatism and careful screening of loan applications was common. Bank staff attempted to balance the priorities of providing loans for reconstruction and development with the need to instill confidence in the bank. Bank president John McCloy selected France to be the first recipient of World Bank aid; two other applications from Poland and Chile were rejected. The loan was for $987 million, half the amount requested and came with strict conditions. Staff from the World Bank monitored the use of the funds, ensuring that the French government would present a balanced budget and give priority of debt repayment to the World Bank over other governments. The United States State Department told the French government that communist elements within the Cabinet needed to be removed. The French Government complied with this diktat and removed the Communist coalition government. Within hours the loan to France was approved. The Marshall Plan of 1947 caused lending by the bank to change as many European countries received aid that competed with World Bank loans. Emphasis was shifted to non-European countries and until 1968, loans were earmarked for projects that would enable a borrower country to repay loans (such projects as ports, highway systems, and power plants).

Webliography:1. 2.

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