WBG World Views
World Bank Group (WBG) is an institution that was created under the umbrella of United Nations’ mission to promote prosperity and reduction of poverty.
The WBG is composed of the five following components,
1. International Bank for Reconstruction and Development (IBRD)
This component is created to help countries reconstruct or develop their economy. IBRD provides funds to middle income governments to invest in projects that promote the main WBG mission of reduction of poverty.
2. International Finance Corporation (IFC)
IFC provide financing directly to private corporations that are willing to invest in developing countries.
3. International Development Association (IDA)
IDA provides interest free loan with minimal administration fees to governments with very low income.
4. Multilateral Investment Guarantee Agency (MIGA)
MIGA provides insurance against political risk like revolution, expropriation and similar situations to encourage investment in developing countries.
5. International Centre for Settlement of Investment Disputes (ICSID)
ICSID main purpose is to resolve disputes between foreign investors and countries receiving WBG loans.
The WBG is embedded within a global market founded on free trade liberal ideas pursuing all nations’ interest and achieving global economy stability through providing financial assistance to poor countries. As in embedded liberal doctrine, WBG believes that in the practical sense without some government intervention different market constraints will usually exist and therefore true free trade and true free market transparency shall require some limited type of market intervention just enough to make sure the market is functioning properly.
It is a no surprise that embedded liberals are strong supporters of the WBG policies since they argue that when poor nations prosper they import products from the developed world, become a good environment for developed nation’s investments...