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International Bank for Reconstruction
and Development (IBRD)
Prepared by: Hinal kalathiya(13) Irfan kalvatar(14) Fatema Lokhandwala(15) Subject: International Trade and Finance(ITF) Guided by: Dr. J.P Majmudar Group 5 Semester 4 Submitted to: Department of Business Administration Maharaja Krishnakumarsinhji Bhavnagar University Index • Profile • Introduction • Functions of IBRD • Objectives of IBRD • Organization structure • Membership • IBRD Services • Achievements • Conclusion Profile • Formation: 1944 75 years ago • Also known as ‘world bank’ • Type- International Organization • Purpose / focus- Crediting • Location- Washington DC • Membership- 189 countries • President – Jim Yong Kim • Website – http://www.worldbank.org What is IBRD? •The International Bank for Reconstruction and Development was established in the year 1944 to help Europe rebuild after World War II. Today, IBRD provides loans and other assistance to middle income countries primarily. •IBRD belongs to World Bank group. It works closely with the rest of the World Bank Group in order help developing countries reduce poverty, promote economic growth, and ultimately to build prosperity. • The institution constitutes of/ owned by the governments of its 189 member countries, which are represented by a 25-member board (5 appointed and 20 elected Executive Directors). • As the largest development bank in the world and part of the World Bank Group, IBRD has two main goals: To end extreme poverty by 2030 and to promote shared prosperity in a sustainable manner. It seeks to achieve these goals primarily by providing loans, guarantees, risk management products, and expertise on development-related disciplines, as well as by coordinating responses to regional and global challenges. • It provides financial resources, knowledge and technical services, and strategic advice to developing countries, including middle income and lower income countries which are credit-worthy. Activities by IBRD • Basic education and health services • Safety needs • Infrastructure development • Environment protection • Technical assistance Objectives of IBRD • To provide long-run capital to member countries for economic reconstruction and development. • To induce long-run capital investment for assuring Balance of Payments (BoP) equilibrium and balanced development of international trade. • To provide guarantee for loans granted to small and large units and other projects of member countries. • To ensure the implementation of development projects so as to bring about a smooth transference from a war-time to peace economy. • To promote capital investment in member countries by the following ways; i. To provide guarantee on private loans or capital investment. ii. If private capital is not available even after providing guarantee, then IBRD provides loans for productive activities on considerate conditions. Functions of IBRD: 1) The institution provides a combination of financial resources, knowledge and technical services, and strategic advice to developing countries, including middle income and credit-worthy lower income countries. 2) Providing loans to governments for agriculture, power, transport, water supply, education, health etc. 3) IBRD aims to reduce poverty in middle-income and creditworthy poorer countries by promoting sustainable development through loans, risk management products, and analytical and advisory services. 4) To promote private foreign investment. 5) Encouraging industrial development of underdeveloped countries by promoting economic reforms. 6) Providing loans to private concerns for specified projects. Membership • Members of IMF are members of world bank. • If a country resigns from its membership, it is required to payback all loans granted to it through interest on due date. • A country holding the membership of bank must subscribe to the charter of the bank. • Each member of the world bank has a capital subscription which is similar to but not identical with its quota in the fund. • The member’s subscription also measures roughly its voting power, but again the smaller nations have a slightly higher vote. T E E -
Organization structure M a n B O P B R O E a A A S g R R I i D D D n E g O O N F F T d i E G r X O e E V c C E D t U R E o T N V r I O E s V R L , E S O P V D M i I E c R N e E T C p T C r O O e R Ms S President • President is elected by the executive directors, is also their chairman • He is not entitled to vote except in case of any tie or equality. • President is responsible for the conduct of the ordinary business of the bank. • Action on bank loans is initiated by the president and staff of the bank. • He can make recommendations about amount, terms & conditions of loans but ultimate approval is given by the executive directors. Board of Governors • All powers of the bank are vested in its Board of governors. • Ministers of finance, central bank presidents / persons of comparable status usually represent member states on the bank’s Board of Governors. • The Board meets annually. • They report directly to the president. Executive directors • The executive Directors make up the Board of Directors of the world bank. They normally meet at least twice a week to oversee the bank’s business including: • approval of loans and guarantees, • new policies, • the administrative budget, • country assistance strategies and borrowing and financial decisions. Thank You.
