Poverty Reduction Strategy Papers: The World Bank (Essay Sample)

The World Bank
Student’s Name
Institutional Affiliation
The World Bank
The World Bank represents five international institutions that offer loans to developing countries across the globe. It is the biggest development bank across the world, and has another role of supervising the development projects of the United Nations. According to Carr (1999), this bank forms the biggest institution in the financial industry by offering financial services to countries across the globe. The institution mainly employs formal employees with financial and technological knowledge that helps them run the institution. The World Bank has over 10,000 workers with a third of them working in developing countries (Reed, 1992). Additionally, the banking institution has opened offices in over 70 countries where the employees work as policy advisers to various ministries, with main focus in the finance sector. The bank’s main roles include consultation with the globe’s financial markets and organizations to support various international economies. Apart from consultations, the bank has established links in non-governmental firms established in developing and developed nations.
According to Lipsky (2010), the World Bank’s organization is similar to a cooperative with 189 member states with each having a Board of Governors that formulates policies for the bank. In most cases the governors are the finance ministers in their respective countries. The governors meet annually as they delegate particular duties to Executive Directors that work directly in the bank. The World Bank has a president that chairs meetings of all the Board of Directors, while managing the bank’s business. The chairman meets the Board of Directors twice a week to manage the business of the bank, especially approval of loans to countries. The group also oversees the guaranteeing processes, formulation of new policies, budget approval, and strategy assistance for developing nations.
Despite facing many challenges, the World Bank has been effective in their policies to eradicate poverty. The decision to focus on countries individually has also bored fruits through the decentralization of staff in the specific countries. The World Bank has expanded global programs that address the various global challenges by partnering with other groups such as the International Monetary Fund and non-governmental institutions. According to Lipsky (2010), non-governmental organizations have helped the World Bank to achieve the objective of enhancing participatory activities and promote community-based projects and activities.
Additionally, the Bank has been successful in advancing country ownership and aligning donors through “Poverty Reduction Strategy Papers” as well as other economic instruments. In essence, the papers have encouraged the institution to focus more on how the developing nations perform upon receiving loans and aids. By analyzing performances of various banks, World Bank is able to come up with new methods of handling fragile nations, including those facing economic stress. The bank has managed to solicit the expertise of skilled employees that develop better economic policies to attain the firm’s main objective, which is poverty reduction (Reed, 1992).
The World Bank’s structure, however, still faces many problems because in reality, economic growth alone can never deliver poverty reduction in an effective way in the poorest nations. It is, therefore, important for the World Bank employees to link well with the affected nations (Carr, 1999). The employees must have the expertise to understand the adaptation problems. In addition, the staff must understand how the society creates negative conditions to the economy and the strengths and weaknesses of the established government structures. It means that when the poor nations start to grow, the growth aims at eliminating the wrong strategies that the government used in the past. Despite understating a country’s economic and developmental structures in a comprehensive manner, the World Bank officials must act in a selective way depending on the nation’s policies the government has set up.
Over the years, the World Bank has failed to focus more on institutional development and capacity building as they deal mostly with governments (Carr, 1999). In this light, the institution must have a re-think on areas they provided unrealistic optimism, especially on growth, infrastructure provision by the private sector and fast turn-around strategies. It is time to get rid of the overall strategies and use the decentralization process to tailor specific programs to specific situations in particular countries. The bank must adapt structures that fit the local socio-political economy of the nations. As much as all developing nations require loans, the World Bank must start lending only to nations that have improving fiscal policies. Countries that have...