Development Goals

Poverty Challenge

Progress toward the Goal

World Bank Strategy

The Role of IBRD

The Role of IDA

Meeting the Poverty Challenge: An Agenda for Action
…demand that all partners accept responsibility…

The international development goals reflect an unprecedented consensus of the international community. Shared goals support the effort to increase aid effectiveness through stronger partnership and country leadership.

A New Development Compact

The agenda facing developing countries is formidable. Many developing countries already reflect the goals in their strategies; others have identified specific intermediate measures linked to longer-term poverty reduction outcomes. Pursuing sound domestic policies will be critical to attracting greater resources. Sound macroeconomic policies, strong financial systems, and well-functioning regulatory, legal, and judicial frameworks will enhance the effectiveness of aid and attract more productive private investment.

The responsibility of developed countries stands out even more clearly as developing countries take full responsibility for their own choices. Key areas for action are summarized below:

1. Dismantling trade barriers is fundamental   Trade barriers in high-income countries cost developing countries over $100 billion a year. Trade restrictions set by the high-income members of the Organisation for Economic Co-operation and Development (OECD) offset the benefit of their aid contributions. (See figure below.)

2. The debt relief agenda must go forward  Following the substantial advances made in fiscal 2001, the next challenge is to move forward with implementation of the Heavily Indebted Poor Countries Initiative, in particular in those countries affected by conflict. Securing sustainable financing on appropriately concessional terms will also be important. (See figure below.)

3. Now is the time to increase aid  Developingcountries’ efforts to improve their policy environments are allowing them to make more effective use of aid. Support from most members of the OECD Development Assistance Committee (DAC) falls well short of the pledged 0.7 percent share of gross national income; so far only Denmark, the Netherlands, Norway, Sweden--and most recently Luxembourg--have met this target. While average DAC contributions declined in 2000, however, aid levels from 15 of 22 DAC members increased over the prior year. (See figure below.)

4. Simplifying and harmonizing aid procedures will lower the burden on developing countries  Multilateral and bilateral donors, working together, can do much to reduce the costs to developing countries of managing aid programs in areas ranging from strategy and medium-term financing to procurement and evaluation. Recent progress in untying aid and procurement will promote efficiency.

The World Bank and the International Development Goals

The Bank is weaving the goals into its operations by:

• Including the goals in country dialogue through the Comprehensive Development Framework, Poverty Reduction Strategy Papers, Country Assistance Strategies, and Sector Strategy Papers, and seeking a better alignment between the goals and those strategies.
• Supporting outcome-based development programs and enhancing statistical and analytical capabilities in many client countries.
• Expanding research on how to increase
• public sector effectiveness and accelerate progress.
• Working with partners to harmonize donor support at the country level and cooperating with other donors in a program of global monitoring and reporting.