Source:
IFIs Latin American Monitor
María José Romero
Mon Oct 05 2009
During the fiscal year from 1 July 2008 to 30 June 2009, the World Bank’s activity was defined mainly by the global financial and economic crisis and the effects it caused in low and middle income countries. The official discourse highlights the range of initiatives implemented by the institution and the record amounts pledged to meet the crisis. However, the Annual Report 2009 figures reveal a significant difference between the promised amounts and those actually disbursed, which challenges the Bank’s activity in response to the crisis.
While the increased IBRD commitments are 144% higher than in the previous exercise, the increase in disbursements was only 77%. But more striking still is that IDA commitments have increased by 25%, but its actual disbursement was less than 1% compared to the previous year.
Two facts stand out in the latest Bank report. The first: Latin America and the Caribbean was the region prioritized by the institution, with 200% of commitments in the previous year and 30% of total Bank financing through the IBRD and IDA in 2009. The second: the increased proportion of Development Policy Loans (DPLs) in relation to total IBRD commitments, from 29.5% to 47%. This instrument has been used since 2004 and is an updated form of the structural adjustment policies of the 80s and 90s.
These data reinforce the need for an in-depth review of the Bank’s current policy conditionalities – with an emphasis on Latin America – which social organizations have questioned for decades.
Commitments vs. Disbursements
According to the Annual Report 2009, during the fiscal year that ended 30 June 2009, the amount of IBRD and IDA commitments reached almost $ 47 billion, compared to $ 25 billion last year. In turn, if commitments from the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA) are taken into account, the World Bank Group committed $ 58.8 billion in 2009, compared with $ 38.2 billion in 2008. It is expected that these figures remain unchanged for the next two years. Other Multilateral Development Banks (MDBs) also increased their loans. For example, in 2008 the Inter-American Development Bank (IADB) approved loans and guarantees for $ 11.08 billion, representing an increase of 27%, compared with $ 8.73 billion approved in 2007.
World Bank put forward five initiatives to support the public sector and eight for the private sector, according to three priority areas: "safety net programs to protect the most vulnerable; maintaining investments in infrastructure; support for small and medium-size enterprises and microfinance.”
These efforts resulted in record levels of commitments which the Bank channeled through the International Bank for Reconstruction and Development (IBRD) which provides financing to middle income countries and creditworthy poor countries, to the International Development Association (IDA), which facilitates grants and interest free loans to the 79 poorest countries in the world and the International Finance Corporation (IFC), which provides financing to the private sector.
See full report (pdf version)
See Spanish version
Related information:
Fostering impunity or accountability? Sweeping changes at the World Bank-IDA by Nancy Alexander (Heinrich Böll Foundation)
DPLs now over half of World Bank lending: Gaping hole in transparency and accountability, by Bank Information Center
Pakistan gets only $345m of $1.61bn World Bank pledge
Bank accused of neglecting poorest countries
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