The Bank’s work in the extractives sector focuses on three main pillars that support the overall goals of ending extreme poverty and boosting shared prosperity:
(1) Financial Sustainability: The Bank works with governments to strengthen fiscal regimes, remove subsidies, and improve tax administration and revenue transparency to build resilience to economic shocks and reduce the opportunities for the resource curse. It also helps implement structured financial solutions to de-risk private sector investments, strengthen enterprises, and reinforce public-private partnerships.
The Bank also works with governments to develop effective management policies for oil, gas, and mining regimes. It starts with supporting capacity building for contract negotiation, and includes developing effective legal and regulatory frameworks, tax and royalty administration, and revenue management.
To ensure effective and transparent revenue management in the extractives sector, the Bank supports the implementation of the Extractive Industries Transparency Initiative (EITI) through technical assistance to countries working to publish and verify company payments and government revenues from oil, gas, and minerals.
By helping governments create an enabling environment, improve sector governance and lower risk, the Bank Group leverages large-scale private sector investment through the IFC, an organization focused exclusively on the private sector in developing countries.
(2) Social Sustainability: For effective development outcomes, local communities must actively participate in extractive industries operations from the very beginning, leveraging the industry’s infrastructure, job creation, and small business opportunities to provide long term sustainable development. To that end, the Bank promotes inclusive growth, bringing together diverse stakeholders to ensure accountability and lessen adverse impacts on communities and the most vulnerable people, particularly in fragile areas.
(3) Environmental Sustainability: The World Bank works closely with governments to develop strategic environmental and social assessments to anticipate sector-wide impacts and to incorporate environmental and social priorities into extractive industries’ policies and regulatory arrangements.
Along with our core lending, analytical work, and knowledge products, the Bank administers Multi-Donor Trust Funds (MDTF) to achieve ambitious development goals:
- The Extractives Global Programmatic Support (EGPS) MDTF supports programs ranging from transparency and governance, to legal and regulatory reform, local economic diversification, strengthening institutions, and social and environmental sustainability.
- The Global Gas Flaring Reduction Partnership (GGFR) is a coalition of governments, oil companies, and international institutions working to end routine gas flaring at oil production sites around the world as a way to increase energy access and mitigate climate change. GGFR focuses on advising governments develop institutions, regulations, policies, infrastructure, and markets for associated gas utilization. The Partnership also works to raise awareness and increase commitments to end routine flaring, monitors and produces annual global flaring data, and facilitates flaring reduction projects.
- The World Bank’s report “The Growing Role of Minerals and Metals for a Low Carbon Future” finds that there will be a substantial increase in demand for several key minerals and metals to manufacture cleaner energy technologies. The Climate-Smart Mining Facility was created to help resource-rich developing countries benefit from this increased demand while ensuring the mining sector is managed in a way that minimizes the environmental and climate footprint.
Last Updated: Oct 11,2019