EECS 1530 Lecture 19: EECS 1530 Lecture 19 Notes
21 Jun 2018
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EECS 1530 Lecture 19 Notes
Introduction
World Bank
The International Bank for Reconstruction and Development (IBRD), also referred to as
the World Bank, was established in 1944.
Its primary objective is to make loans to countries in order to reduce poverty and
enhance economic development.
The World Bank has been successful at reducing extreme poverty levels, increasing
education, preventing the spread of deadly diseases, and improving environmental
conditions.
Its main source of funds is the sale of bonds and other debt instruments to private
investors and governments.
The World Bank has a profit-oriented philosophy.
Therefore, its loans are not subsidized but instead are extended at market rates to
governments (and their agencies) that are deemed likely to repay them.
A key aspect of the World Bank’s mission is the Structural Adjustment Loan (SAL),
established in 1980.
The SALs are intended to enhance a country’s long-term economic growth.
Because the World Bank provides only a small portion of the financing needed by
developing countries, it attempts to spread its funds by entering into co-financing
agreements.
Co-financing is performed in the following ways.
Official aid agencies.
Development agencies may join the World Bank in financing development projects in
low-income countries.
Export credit agencies.
The World Bank co-finances some capital-intensive projects that are also financed
through export credit agencies.
Document Summary
The international bank for reconstruction and development (ibrd), also referred to as the world bank, was established in 1944. Its primary objective is to make loans to countries in order to reduce poverty and enhance economic development. Development agencies may join the world bank in financing development projects in low-income countries. The world bank co-finances some capital-intensive projects that are also financed through export credit agencies. Primary objective is to make loans to countries in order to reduce poverty and enhance economic development. The world bank has been successful at reducing extreme poverty levels, increasing education, preventing the spread of deadly diseases, and improving environmental conditions. Because the world bank provides only a small portion of the financing needed by developing countries, it attempts to spread its funds by entering into co-financing agreements. Its main source of funds is the sale of bonds and other debt instruments to private investors and governments. The world bank has a profit-oriented philosophy.
