With subscribed capital of $140 million and 8,000 staff, the World Bank has played a key role in the global economy. It is the biggest single financier of development projects in the world, having committed US$23 billion in 1993 to Southern governments.

The World Bank operates through three affiliates.

• The International Bank for Reconstruction & Development (IBRD), the original World Bank -- loans money at market interest rates mainly to middle-income nations.
• The second affiliate, the International Finance Corporation (IFC) -- makes loans and equity investments to privately owned firms. It is run as a semi-autonomous agency, with its own managing vice president and a separate staff.
• The International Development Association (IDA), makes concessional (no-interest) loans to the poorest countries --those with per capita annual incomes of $805 or less -- with payback periods of up to 40 years. The IBRD and IDA operate as a single agency with two "checkbooks", sharing a common management, staff, and facilities. They accounted for 92 percent of the World Bank's total loans in 1993.

The Bank gets about 10 percent of its funds from taxpayers, in the form of direct contributions from member governments.

The IFC operates partly with funds contributed directly by its member countries but mainly with funds borrowed from the IBRD. The IFC is the fastest growing part of Bank operations, with IFC investments having grown to $2.1 billion last year. Among the transnational corporations represented on the IFC Business Advisory Council are the Bank of Tokyo, Credit Lyonnaise, Treuhandanstalt, S G Warburg.

The Corporate Structure Of The World Bank

The world's ten richest nations hold 54 percent of World Bank votes, with the US alone controlling 17 percent. These ten nations represent less than 20 percent of the world's population. In contrast, 48 Sub-Saharan African nations have five percent of the World Bank votes.

The U.S. is the largest single contributor to the bank and, together with the four other largest stockholders, Germany, Japan, UK and France, appoints its own representative on the Bank executive board. The smaller stockholders form 'constituencies' to elect the other 19 EDs. ?

Internal Bank Review Shows Ineffective Projects

According to a damning internal 1992 review based on the Bank's own economic criteria, 37 percent of completed projects were considered "unsatisfactory"-- up from ten percent in 1981. The same review found that the bigger the project, the more likely it was to fail.

Structural Adjustment Loans

In the 1980's the World Bank began its adjustment lending--cash payments designed to ease balance-of-payments problems during economic policy reforms. In reality, governments have used most World Bank Structural Adjustment loans (SALS) to repay their debts to the commercial banks, using funds that might have been used for national development.

SALs are linked to nearly all aid transferred to the South because governments and private banks often require the 'seal of approval' of the World Bank for commercial loans, debt relief, and even some bilateral aid made to Southern countries. Bilateral aid comprises one fifth of all loans.

Through SALs, the World Bank has increased global unemployment, increased net resource flows from Third World borrowers to commercial bank creditors, increased the concentration of income and wealth, displaced small farmers, overexploited natural resources, and undermined democratic governments.

World Bank Secrecy

The World bank is not accountable to the public. While international pressure has recently forced the World Bank to open a new public information centre, it will still withhold most project preparation documents and a wide range of environmental and social reports that are now restricted. The Bank has no plans for citizen participation in loan approval decisions.

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