- The main thematic focus of this year’s report is on highlighting the value proposition of the World Bank Group (WBG) trust funds as an important source of development finance in response to changing global priorities, essential for a stronger, better, more flexible institution.
- Trust funds are used strategically to complement the core WBG funding. They enhance global, regional, and country-level knowledge; provide targeted support to clients as a complement to IBRD and IDA funding; and provide funding to countries and clients that cannot receive IBRD and IDA funding.
- One of the key factors hampering progress in achieving the Sustainable Development Goals (SDGs) is a global financing gap estimated at $3 trillion to $5 trillion a year. Trust funds help close that gap by helping governments build their capacity to mobilize revenue and manage public expenditure and public debt.
- The World Bank Group identified five global issues as its institutional priorities: climate change, crisis response, jobs, gender, and infrastructure. In each of these focus areas, trust funds play a vital role, complementing IBRD, IDA, and IFC.
- The current portfolio contains many trust funds, most are very small in size. This results in modest effectiveness and risks of duplication. Also, the higher costs of coordination and reporting affect the efficiency of these small trust funds. Therefore, the Bank is engaged in an ambitious trust fund reform effort as part of improving the business model.