Addressing a Muititude of Global Challenges

The world is facing myriad global challenges—including climate change, pandemics, and conflict. At the same time, many developing countries are dealing with shrinking growth prospects, weakening investment, and surging debt. These trends are reversing hard-won development gains and threatening progress toward the Sustainable Development Goals: nearly 700 million people are living in extreme poverty, and almost half the world’s population live on less than $6.85 a day. These challenges are having particularly negative impacts on women and girls, poor and vulnerable people, and other marginalized communities.  

As we address these challenges, global public goods are an important part of the solution. These are goods that benefit everyone and can be used over and over again without running out—biodiversity, clean air, the prevention of communicable diseases, international trade, the international financial architecture, and open data are some examples. The World Bank Group is working to strengthen the delivery of these goods through our financing, knowledge, and partnerships. From 2020 through 2022, our financing for global public goods—including climate action, pandemic preparedness, and support for countries affected by fragility—exceeded $100 billion.

The largest multilateral financier of climate action in developing countries, the World Bank’s total climate finance amounted to a record-high of $29.4 billion, or 40 percent of total IBRD and IDA finance, in fiscal 2023. About half of the Bank’s climate finance supports adaptation to address mounting climate impacts on the poorest and most vulnerable people. Since June 2022, we have produced more than 20 Country Climate and Development Reports—core diagnostics that integrate climate change and development considerations for countries, helping them prioritize the most effective ways to reduce emissions and boost adaptation. Collectively, the low-carbon development strategies from these reports can reduce emissions by 70 percent, without harming growth. As of July 1, 2023, all new Bank financing operations—including projects and other assistance—that go to our Board will be expected to demonstrate how they meet our commitment to the Paris Agreement goals.

The COVID-19 pandemic made clear the importance of preventing, preparing for, and responding to pandemics, especially in developing countries. Since the onset of the pandemic, the World Bank has provided $14.2 billion to over 100 countries to support their health responses. We also help countries finance and build stronger, more resilient health systems, including more than $30 billion to strengthen primary care and public health. We invest in regional programs, such as the Africa Centers for Disease Control and Prevention, to better detect diseases, expand laboratory capacities, and pool resources. Through the Pandemic Fund, which is housed at the World Bank, we finance projects that address critical gaps and strengthen pandemic prevention, preparedness, and response in developing countries.

Nearly half the world’s extreme poor live in countries affected by fragility, conflict, and violence, and the spillover effects place all countries at risk. The World Bank supports conflict-sensitive, green, and inclusive growth in these contexts, with a strong focus on preventing conflict. Through our partnerships, including with UN agencies and other humanitarian organizations, we engage in the most challenging situations. Since IDA16, average annual IDA financing for fragile and conflict-affected countries has increased more than fivefold; and the share of IBRD’s portfolio in these countries nearly doubled from fiscal years 2016 to 2021. To address forced displacement, we help countries support refugees, internally displaced people, and host communities through concessional financing, social protection programs, and economic development.

Since Russia’s invasion of Ukraine in February 2022, the World Bank Group has leveraged our broad range of financing instruments to rapidly disburse funds while also mobilizing financing and support from donor partners. We have mobilized more than $37.5 billion in emergency financing for Ukraine by providing platforms for generous support from donors and international partners to supplement our own resources. This financing helps the government meet urgent budget needs, support essential public services, and address critical recovery and repair needs. By the end of fiscal 2023, we had disbursed nearly $23 billion. This support has reached 13 million Ukrainians, helping provide wages for essential employees, pensions for the elderly, and social programs for the vulnerable.

A mounting debt crisis is making it harder for countries to confront these challenges. Total debt in developing countries is at the highest level in 50 years—about 60 percent of the poorest countries are at extreme risk of debt distress, if not already facing it, and the danger is spreading to many middle-income countries. This trend has been further exacerbated by rising interest rates, depreciating currencies, and slowing global growth. The World Bank supports comprehensive, long-term solutions for countries dealing with unsustainable debt levels. This includes our support for the G20’s Common Framework, targeted relief for countries in debt distress, and measures to enhance accountability and debt transparency. We also co-chair the Global Sovereign Debt Roundtable with the IMF and the G20 Presidency of India to address barriers to debt restructuring.

As these and other challenges evolve, the World Bank Group is finding ways to better support countries, strengthen our response to crises, and reverse the precipitous decline in economic growth, poverty reduction, and human development. We are working closely with governments, civil society, the private sector, and other stakeholders to hone our vision and enhance our mission to better aid a rapidly changing world. Ultimately, we expect to promote even more sustainable, inclusive, and resilient growth as we embark on a new era in development.