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| Britannica Concise Encyclopedia: International Bank for Reconstruction and Development |
For more information on International Bank for Reconstruction and Development, visit Britannica.com.
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| Banking Dictionary: International Bank for Reconstruction and Development (IBRD) |
International lending organization, popularly known as the World Bank, founded at the Bretton Woods economic conference in 1944 initially to finance the reconstruction of Europe following World War II, and more recently to provide developing countries with long-term, low-interest credit for industrial development when private financing is unavailable. The World Bank works closely with the International Monetary Fund (IMF) and currently has 184 member countries. The World Bank finances its operations through member subscriptions, sale of its own securities, and net earnings. Most World Bank loans are made at variable interest rates pegged to its current cost of funds. Member countries must also be IMF members. In recent years, the World Bank has redefined its traditional role. The bank has set aside funds for new loans, in response to the world debt crisis, and has added its guarantee to new bank loans made to less developed countries. See also Multilateral Development Banks; World Bank Group.
| Columbia Encyclopedia: International Bank for Reconstruction and Development |
The bank also operates the Economic Development Institute, which offers training in economic development for officials of member countries. Another development institution is the International Finance Corporation (IFC; est. 1956), which invests in private enterprises without government guarantee. The IFC has 181 member nations. The bank organized the International Development Association (IDA; 1960) to extend credit on easier terms, mainly to developing countries. The IDA has 167 member nations. Members of the IFC and IDA must be members of the IBRD. Criticism that the IBRD-financed projects were environmentally destructive led the bank to establish an environmental fund (1990) providing low-interest loans for developing countries. Developing nations have complained that the IBRD imposes the free-market system on them, thereby discouraging planning, nationalization, and public investment.
Bibliography
See the World Bank's publication, World Bank Operations: Sectoral Programs and Policies (1972); E. S. Mason and R. E. Asher, The World Bank since Bretton Woods (1973); C. Payer, The World Bank: A Critical Analysis (1982); S. Please, The Hobbled Giant: Essays on the World Bank (1984).
| Wikipedia: International Bank for Reconstruction and Development |
The International Bank for Reconstruction and Development (IBRD) is one of five institutions that comprise the World Bank Group. The IBRD is an international organization whose original mission was to finance the reconstruction of nations devastated by World War II. Now, its mission has expanded to fight poverty by means of financing states. Its operation is maintained through payments as regulated by member states. It came into existence on December 27, 1945 following international ratification of the agreements reached at the United Nations Monetary and Financial Conference of July 1 to July 22, 1944 in Bretton Woods, New Hampshire.
The IBRD provides loans to governments, and public enterprises, always with a government (or "sovereign") guarantee of repayment subject to general conditions (pdf). The funds for this lending come primarily from the issuing of World Bank bonds on the global capital markets—typically $12–15 billion per year. These bonds are rated AAA (the highest possible) because they are backed by member states' share capital, as well as by borrowers' sovereign guarantees. (In addition, loans that are repaid are recycled, or relent.) Because of the IBRD's credit rating, it is able to borrow at relatively low interest rates. As most developing countries have considerably lower credit ratings, the IBRD can lend to countries at interest rates that are usually quite attractive to them, even after adding a small margin (about 1%) to cover administrative overheads.
Commencing operations on June 25, 1946, it approved its first loan on May 9, 1947 ($250m to France for postwar reconstruction, in real terms the largest loan issued by the Bank to date).
The IBRD was established mainly as a vehicle for reconstruction of Europe and Japan after World War II, with an additional mandate to foster economic growth in developing countries in Africa, Asia and Latin America. Originally the bank focused mainly on large-scale infrastructure projects, building highways, airports, and powerplants. As Japan and its European client countries "graduated" (achieved certain levels of income per capita), the IBRD became focused entirely on developing countries. Since the early 1990s the IBRD has also provided financing to the post-Socialist states of Eastern Europe and the republics of the former Soviet Union.
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