Speaking at the Council on Foreign Relations (CFR), World Bank Group President Jim Yong Kim set the stage for the 2014 IMF and World Bank Spring Meetings, where he outlined key measures to make the institution more efficient, effective and responsive to its clients.
President Kim announced a $100 billion increase in the amount of loans through the International Bank for Reconstruction and Development (IBRD) to middle income countries over the next decade. This complements last December’s record replenishment of $52 billion for the International Development Association (IDA), the Bank’s concessional lending window for the poorest countries.
President Kim also highlighted efforts to improve and increase cooperation between the institution’s public and private sector arms. The Multilateral Investment Guarantee Agency (MIGA), which provides risk insurance and guarantees, and the International Finance Corporation (IFC), the largest provider of multilateral financing for the private sector in developing countries, will work more cohesively with IDA and IBRD to deliver as “One World Bank Group”.
Listen to his announcement here:
These reforms aim to better position the World Bank Group (WBG) to achieve its ambitious twin goals of ending extreme poverty by 2030 and boosting shared prosperity for the bottom 40 percent of the population in developing countries, which were unveiled at last year’s Spring Meetings.
Additionally, during October’s Annual Meetings, the WBG Board unanimously endorsed a reform strategy to better align staff, finances, and priorities to meet these goals. ONE has welcomed President Kim’s initiative to transform the WBG into a solutions and results oriented institution.
During the event at CFR, President Kim described steps being taken by the WBG to deliver on these twin goals, including nearly doubling annual lending to middle-income countries from $15 billion to $28 billion, boosting support to the private sector by increasing MIGA’s new guarantees by roughly 50 percent over the next four years, and nearly doubling IFC’s portfolio over the next decade to $90 billion.
He noted, “[t]aken as a whole, the World Bank Group’s annual commitment, which today is around $45 to $50 billion dollars, is expected to grow to more than $70 billion in the coming years. This increased financial firepower represents unprecedented growth for the World Bank Group.”
Notably, the WBG’s effort to shore up support for middle income countries reflects the changing geography of poverty, which are now home to three-quarters of the world’s extreme poor. Middle-income countries such as China, India and Indonesia continue to struggle with rising inequality and deep pockets of poverty, where large segments of the population remain in extreme poverty or are vulnerable to falling below the $1.25 per day line. By increasing available funds for these countries, the Bank is demonstrating its strong commitment to ending poverty in all corners of the world.
President Kim will formally present the Bank’s increased financial capabilities when finance ministers, central bankers and development experts from around the world converge on Washington, D.C., to attend the World Bank Group and International Monetary Fund (IMF) Spring Meetings, taking place from April 11 to 13.
The WBG and IMF Civil Society Teams are hosting a Civil Society Policy Forum between April 7 and 12, which brings together civil society representatives, government officials, academics, private sector participants and others to exchange views and dialogue on international development.
ONE will be participating, attending and reporting back on several events around the Spring Meetings so stay tuned!