The World Bank
The World Bank was created in 1944 as part of the Bretton Woods Agreement. One division of the World Bank is today an organization associated with the United Nations and finances projects stated to increase the economic development of member states.
History
The World Bank is an internationally supported bank that provides financial and technical assistance[1] to developing countries for development programs (e.g. bridges, roads, schools, etc.) with the stated goal of reducing poverty. The World Bank differs from the World Bank Group in that the former comprises only the International Bank for Reconstruction and Development and the International Development Association, while the latter incorporates these entities in addition to three others.
- In July 1944 – one year before the end of World War II – delegates from 44 countries met for the United Nations Monetary and Financial Conference held at the Mount Washington Hotel in Bretton Woods, New Hampshire. The conference aimed to create the framework for post-war international economic cooperation and reconstruction. The intellectual leaders at the conference were John Maynard Keynes (Adviser to the Treasury in the United Kingdom), and Harry Dexter White (Assistant Secretary of the Treasury in the United States). While the conference resulted in the formation of two institutions, the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (World Bank), the creation of the World Bank was not the primary focus. The majority of time and effort was spent on the IMF Commission under Harry Dexter White’s leadership. The work of the World Bank Commission, on the other hand, occurred only in the last few days of the conference. Its articles of agreement - primarily drafted by John Maynard Keynes – included rebuilding the economies of countries devastated by war and increasing the economic development of developing countries. The Bank’s first loan was to France and loans to other European countries followed. But when the 1947 Marshall Plan took over post-war reconstruction efforts in Europe, the Bank quickly shifted to funding infrastructure projects around the world in sectors such as power, irrigation, and transportation. The first loan to a non-European country was to Chile in 1948 for $13.5M USD for hydroelectric power generation. The Bank also initiated a technical assistance program and in 1955 established the Economic Development Institute to provide training to officials from member countries. During the early years, the Bank evolved to meet the needs of its members. In 1956, the International Finance Corporation (IFC) was established to focus exclusively on the private sector, and in 1960 the International Development Association (IDA) was created to provide resources for less creditworthy members. The IFC’s first loan was to Brazil, in the amount of $2M USD, for the manufacture of electrical equipment. The Bank also mediated three international disputes that had an economic element: the nationalization of Iran’s oil industry; the development of the Indus River Water system; and the financing for the Aswan High Dam on the Nile.
The World Bank was formally established on 27 December 1945, following the ratification of the Bretton Woods agreement. The concept was originally conceived in July 1944 at the United Nations Monetary and Financial Conference. Two years later, the Bank issued its first loan: $250 million to France for post-war reconstruction, the main focus of the Bank's work in the early post-World War II years. Over time, the "development" side of the Bank's work has assumed a larger share of its lending, although it is still involved in post-conflict reconstruction, together with reconstruction after natural disasters, response to humanitarian emergencies and post-conflict rehabilitation needs affecting developing and transition economies. There are some criticisms of the results of the World Bank's "development schemes" leading to corruption and widespread exploitation of the corporations who are given monopolies of developing nation's resources.
See also
External links
- World Bank Group
- Rastas and the World Bank
- 75th Anniversary of World Bank Articles of Agreement Ratification
