Kim Says World Bank to Focus on Larger ProjectsSandrine Rastello
The World Bank will move away from small-scale projects to focus on larger programs where its involvement increases the odds of attracting private funds, President Jim Yong Kim said today.
The bank must be more selective in its lending and be ready to abandon programs that could be done better by other groups, Kim said in a speech to George Washington University students. That doesn’t mean it will stop financing whole sectors such as agriculture or infrastructure, he told reporters afterward.
“It’s trying to be focused on what we can do that will really have an impact,” Kim said after the speech. “Many of these large-scale projects are going to require private-sector funding and we know we can help.”
After shaking up the Washington-based lender’s management and organizational structure, Kim is due to submit a strategy next week to its 188 member countries for meeting the goals of ending extreme poverty by 2030 and boosting incomes for the world’s poorest 40 percent. With the bank’s limited lending power, reaching those targets will require more public and private funds, Kim has said.
For example, the bank, which last week approved a $140 million project to replace aging gas turbines at a power plant in Myanmar, said its private sector arm is working to bring private investors into the country’s energy market.
A Uganda hydropower project operating since last year, for which the bank provided financing and guarantees, attracted $900 million in private capital, according to the lender.
“It’s crucial that the bank focus not just on leveraging private sector funds, but ensuring companies respect social and environmental standards in countries where they operate,” Nicolas Mombrial, who heads the Washington office of charity group Oxfam, said in an e-mail.
The bank will increase its commitments to states deemed “fragile” that are in conflict or coming out of one, Kim said today. It will also invest in improving women’s lives and in mitigating climate change, he said.
In a memo to staff obtained by Bloomberg News last week, Kim said the bank will organize all of its technical experts into 14 groups to improve the advice it gives member-states on topics from the environment to education.
“We’re trying to create a whole new culture at the World Bank where regions will be dependent on technical areas to provide support,” Kim said. “Technical areas are going to have to be good because if the regions are not asking for their support, than it’s going to be a real problem.”