Prioritizing strategic interventions across the World Bank Group
The World Bank’s principal institutions—the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA)—work in ever-closer coordination with the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA) to leverage the collective strength of the World Bank Group (WBG) for the benefit of its partner countries. The comparative advantage of the WBG comes from the powerful combination of country depth and global breadth, public and private sector instruments and relationships, multisectoral knowledge, and the ability to mobilize and leverage financing. Collaboration across IBRD, IDA, IFC, and MIGA has grown over time, and spans a range of activities at the regional, country, sector, and thematic levels.
World Bank experts are organized across teams of Global Practices, which focus on key technical areas of development, as well as Global Themes, composed of teams working to deliver on cross-cutting corporate priority areas, such as climate change, gender, fragility, infrastructure, public private partnerships, and guarantees. Collaboration across these teams allow for the development of comprehensive solutions for clients. The Bank’s teams work together with country-based staff, IFC, MIGA, and country partners to prioritize the WBG’s program of financial, analytical, advisory, and convening support, based on the Bank Group’s comparative advantage, the client’s priorities, and in response to development challenges highlighted in the Systematic Country Diagnostic (SCD).
The SCD identifies the barriers to eliminating extreme poverty and boosting shared prosperity within a country, and is carried out by the WBG before developing a new partnership framework with a country. The diagnostic guides the development of the Country Partnership Framework (CPF), which outlines the strategic interventions and support on which the WBG and partner country will engage. This process has been in place since July 2014, and as of the end of this fiscal year, the WBG has prepared SCDs in 90 countries and new CPFs in 57 countries.
Maintaining budget discipline to maximize the use of financial resources
The World Bank Group aligns its resources through an annual strategic planning, budgeting, and performance review exercise, called the “W” process for its three top-down decision points and two bottom-up input phases:
W1: Considering external factors and clients’ demands, senior management sets strategic planning priorities.
W2: Vice-presidential units (VPUs) review and respond to corporate priorities.
W3: Senior management refines the guidance on priorities for each World Bank Group institution.
W4: VPUs develop work programs in response to determined priorities and planned budget envelopes.
W5: Senior management for each institution separately review VPU-level allocations and agree on aggregate budget proposals. The Board reviews and approves budgets for the next fiscal year.
The World Bank Group has made significant progress in aligning its budget to address development priorities, to reinforce selectivity and efficient delivery, and to maintain budget sustainability. It has done so through a combination of revenue expansion and spending containment measures that include completing an Expenditure Review that saved $400 million. The World Bank has also implemented new sustainability principles and budget indicators that allow for administrative expenses to be covered by revenues generated from operations, and realigned its budget with strategic priorities. The Bank Group is committed to continued financial sustainability, strategic alignment, and efficiency.
During the fiscal 2019–21 planning period, the Bank Group will focus on priorities arising from the organization’s goals of ending extreme poverty and boosting shared prosperity, as set out in its Forward Look strategy. Specific priorities include: support for client-facing work, particularly for the IDA18 scale-up and areas affected by fragility, conflict, and violence, and for meeting the IBRD capital increase policy commitments; the Bank Group–wide partnership to crowd in private sector investment and create new markets to maximize finance for development; a renewed focus on human capital and on enhancing the Bank Group’s leadership on global issues; and improvement of the business model for greater effectiveness and efficiency.