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Launched in February 2025, the World Bank's Framework for Financial Incentives offers countries a powerful package of benefits—more financing, longer repayment periods, and lower interest rates—when their projects deliver benefits that extend beyond their own borders. The FFI rewards middle-income countries for scaling up investments in pandemic preparedness, biodiversity conservation, and cross-border water management while pursuing their national development priorities.
Through the FFI’s Livable Planet Fund, middle-income countries—home to 75% of the world's population and holding most of the world's biodiversity hotspots—now have access strategic grants that make ambitious cross-border projects financially viable.
For decades, the question has lingered: who pays to protect our shared planet?
"Global public goods is now such an interesting concept because it essentially starts to recognize that we are in a single world," explains Homi Kharas, a senior fellow at the Brookings Institution. "Development in any country also has implications for how other countries develop."
World Bank FFI Projects
A snapshot of projects approved under the World Bank’s FFI as of October 2025. (View full size.)
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What makes the World Bank's new Framework for Financial Incentives (FFI) revolutionary, according to Kharas, is how it eliminates this traditional trade-off between national development and global responsibility.
"The beauty of these kinds of programs is that it takes away this notion of a trade-off," Kharas explains. "For the finance minister the question is never going to be 'either do this or do that.' The question is: if you do this in this way, then you can actually do better for your own country and better for the world."
00:04 Global public goods is uh now such an interesting
00:08 uh uh concept because it essentially starts to recognize
00:14 that
00:15 we are in
00:16 a single world.
00:18 And that development in any country
00:21 also has implications for how other countries also develop.
00:26 It's a new mental model
00:28 that when one does development,
00:30 one has to think about these things as being assets for the world.
00:36 And that every country has a responsibility to protect these global assets,
00:42 but that every country shouldn't be expected to pay
00:45 for it themselves because they are global assets.
00:48 So there has to be a certain element of burden sharing,
00:52 and that's where the issue of how one brings middle income countries into this.
00:58 Now with the new livable Planet Fund
01:01 and with the framework for financial incentives,
01:05 middle income countries too can participate in these kinds of programs.
01:09 The beauty of these kinds of programs is that it
01:13 takes away this notion of a trade-off
01:16 for the finance minister.
01:17 The question is never going to be for him
01:20 either do this or do that.
01:23 The question for him is going to be,
01:25 if you do this in this way.
01:29 Then you can actually
01:31 do
01:32 better for your own country and better for the world because
01:37 we have now the mechanisms to support you in doing this.
00:03 There's a great Joni Mitchell song that has the line in it,
00:07 you don't know
00:08 what you've got
00:09 till it's gone.
00:11 And I think that that really tells the story of global
00:16 public goods,
00:17 the importance of biodiversity,
00:19 of
00:20 a clean atmosphere,
00:22 of a livable
00:24 planet.
00:24 Now the problem is,
00:26 in economic terms,
00:27 the benefits of global public goods are very widely
00:31 dispersed,
00:32 but the question is who's going to pay
00:35 for them.
00:36 It's great to see the World Bank today
00:38 playing a leadership role
00:40 in restoring global public goods to where they ought to be,
00:42 which is right at the top of our international agenda.
00:45 Our ultimate responsibility for for our generation.
00:49 is to hand on to our children
00:52 and to their grandchildren,
00:54 a planet that is sustainable,
00:56 a planet that is livable,
00:57 a planet that avoids climate catastrophe.
01:00 We need to behave like good ancestors who think
01:04 about the well-being
01:05 of people
01:06 in the future.
01:07 And I think what the World Bank has put in place with this initiative
01:11 is a financial structure
01:13 that creates the incentives that could enable us to do that.
Kevin Watkins, visiting professor at the Firoz Lalji Institute for Africa at the London School of Economics, puts the stakes in stark terms…referencing a classic Joni Mitchell song. The story of global public goods, he says, captures the importance of biodiversity, healthy ecosystems, and functioning natural systems that hold societies together—things we don't truly value until they're gone.
"It's great to see the World Bank today playing a leadership role in restoring global public goods to where they ought to be, which is right at the top of our international agenda,” Watkins says.
Watkins frames the FFI as a moral imperative for this generation: "Our ultimate responsibility is to hand on to our children and to their grandchildren a planet that is sustainable, a planet that is livable. We need to behave like good ancestors who think about the well-being of people in the future, and I think what the World Bank has put in place with this initiative is a financial structure that creates the incentives that could enable us to do that."
00:03 There's a great Joni Mitchell song that has the line in it,
00:07 you don't know
00:08 what you've got
00:09 till it's gone.
00:11 And I think that that really tells the story of global
00:16 public goods,
00:17 the importance of biodiversity,
00:19 of
00:20 a clean atmosphere,
00:22 of a livable
00:24 planet.
00:24 Now the problem is,
00:26 in economic terms,
00:27 the benefits of global public goods are very widely
00:31 dispersed,
00:32 but the question is who's going to pay
00:35 for them.
00:36 It's great to see the World Bank today
00:38 playing a leadership role
00:40 in restoring global public goods to where they ought to be,
00:42 which is right at the top of our international agenda.
00:45 Our ultimate responsibility for for our generation.
00:49 is to hand on to our children
00:52 and to their grandchildren,
00:54 a planet that is sustainable,
00:56 a planet that is livable,
00:57 a planet that avoids climate catastrophe.
01:00 We need to behave like good ancestors who think
01:04 about the well-being
01:05 of people
01:06 in the future.
01:07 And I think what the World Bank has put in place with this initiative
01:11 is a financial structure
01:13 that creates the incentives that could enable us to do that.
Nick Vaughan of the International Finance Facility for Education (IFFEd) believes there is "a collective action problem" that requires creative solutions. The FFI, he says, represents exactly the kind of innovation needed.
"Countries should be offered incentives to make the necessary investment to address the externality," Vaughan explains. "I'm really pleased and excited to see the World Bank innovating at pace to offer incentives and adjust their frameworks."
"I would urge [countries] to approach the World Bank and other MDBs first because these institutions provide the best possible terms for countries to invest in national priorities."
00:04 In terms of who should address these global public goods,
00:07 it's important to recognize that it's a collective action problem.
00:11 Countries should be offered incentives to make
00:13 the necessary investment to address the externality.
00:16 I'm really pleased and excited to see the
00:18 World Bank innovating at pace to offer incentives
00:22 and adjust their frameworks.
00:24 For a country considering their financing,
00:26 I would urge them to approach the World Bank and other MDBs first
00:32 because these institutions provide the best possible terms
00:35 for countries to invest in national priorities.
Learn More About the FFI
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