This research paper is focused on the role World Bank in Poverty Reduction, as the primary role of the World Bank is to enable development and progress in the backward countries and regions of this world. This paper explains the brief history of the World Bank, and World Bank’s five institutions. It also investigates how the World Bank is continually trying to reduce poverty by lending billions of dollars to poor countries .This paper gives some of the facts of the under-developed countries and the strategies which World Bank has incorporated to reduce the poverty in those countries.
The World Bank was incepted with the mission of achieving a world without poverty and to provide bare minimum living standards to every person in this world encompassing the basic necessities like food, shelter and clothing. Since the inception of the bank 50 years ago, there have been drastic and fundamental shifts about how the World Bank would achieve its primary goals. The World Bank, as it is, is highly influenced by the super powers of this world and the political implications of this fact are quite evident in the decisions taken by the bank to achieve its mission. This fact highly complicates the way the bank charters its strategies towards poverty elimination and the targeted regions of this world which would be affected by this charter. The political and academic sects of this world are the primary influencing factors in the World Bank’s role in eliminating poverty and illiteracy in this world and reaching the Millennium Development goals set by the bank members.
History and Organization
To better understand the role of the World Bank in today’s world, it is important to refresh a little bit about the history and inception of the World Bank. The bank was conceived in 1944 to reconstruct war-torn Europe. Since then the bank has been one of the largest sources of assistance for all developing nations around the world. The World Bank is often referred to as ‘one of the specialized agencies of the United Nations’. It has 184 member countries that are responsible for the financing and expenses of the bank. The World Bank group also referred to as the Bank Group, has since then become the world’s largest sources of funding and knowledge for developing countries. The World Bank is mainly comprised of its five primary Institutions:
•International Bank for Reconstruction and Development (IBRD) •International Development Association (IDA)
•International Finance Corporation (IFC)
•Multilateral Investment Guarantee Agency (MIGA)
•International Centre for Settlement of Investment Disputes (ICSID) The term "World Bank" generally refers to the IBRD and IDA, whereas the World Bank Group is used to refer to the institutions collectively. The IBRD and IDA provide low-interest loans, interest free credit and grants to the developing countries. The bank has around 10,000 professionals working in the different offices around the world. The IFC is responsible for promoting private sector investment supporting high-risk sectors and countries. The MIGA is responsible for providing political risk assurance to investors and lenders who wish to invest and lend in the developing nations. The ICSID is primarily responsible for settling investment disputes between foreign investors and the host nations. It is very important to outline some of the major areas in which the World Bank has actively participated and strived to bring progress in: •Debt and Health Relief for the under-developed nations: The World Bank has time and again invested significant resources to provide debt relief to the poor countries which would enable the countries to divert those repayment dollars to housing, education, health and good welfare of their citizens. •Corruption and Fraud: The bank has constantly strived to carry out anti-corruption efforts and has implemented strategies to prevent fraud in the projects which are...