Trust funds and FIFs represent some of the best cooperation, commitment, and action of the international community to address the world’s most pressing problems. They help advance progress on the Sustainable Development Goals (SDGs) and the policy and investment priorities of middle and low-income countries. Trust funds and FIFs are flexible, responsive tools in the World Bank’s comprehensive toolkit of policy and financial instruments, bringing both complementarity to Bank operations and targeted and customized solutions.
By creating a platform for innovation, trust funds and FIFs often have a catalytic, outsized impact on global development. The highly concessionary financial resources provided by these instruments co-finance both IBRD loans and IDA credits, which helps soften terms for borrowing countries and makes it easier to pilot innovative solutions by de-risking investments in an efficient manner. These resources encourage experimentation, make space to pilot and scale up projects, and generate global public goods in which borrowing countries may be unwilling to invest without incentives to do so.
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