The World Bank

The World Bank has been a catalyst for development in emerging economies, yet receives criticism as well. Discuss this situation. Please share an example of this from your research and video

Since its inception in 1944, the World Bank, plus its sister organizations, including the World Trade Organization (WTO) and the International Monetary Fund (IMF), have served as catalysts for economic development in both developed and emerging economies. When it was first conceived, the World Bank served just as a lender determined to help European countries revitalize and rejuvenate their economies and economic slumps that came after World War 1 and World War 2. Today, according to the Council on Foreign Relations, that focus has shifted to funding and helping poor and emerging economies to eradicate poverty and stabilize their economies respectively (Masters & Chatzky, 2019). Through its ambitious economic policies, such as the “free market” ideology and capitalism, economies like China, Singapore, South Korea, and India have managed to achieve unprecedented and sustained growth for the past few decades. China, for instance, is believed to have recorded one of the greatest economic growths of nearly 10 percent annually, uplifting more than 850 million from poverty (The World Bank, n.d.). The World Bank is presently funding more than 2,600 projects in poor countries – helping to address key pressing developmental issues.

Regardless of this good effort, experts are worried that the World Bank does not provide policies and solutions that will effectively address problems caused by or issues that are likely to emanate from this new economic growth, most of which stem from the policies the global financier is passing or advocating for, especially in emerging economies. For example, as highlighted by Robert Zoellick, the President of World Bank Group, in the report titled “China: The Case for Change on the Road to 2030,” Chinese leaders have realized that the nation’s growth model will have to be adjusted to accommodate new challenges (Viddler, 2014). Although this model, which was pinned on “export growth” and “investment,” has been successful for the last 30 years, the country needs to completely transition to a market economy by instituting reforms in the financial, labor, land, and enterprise sectors. The country must prepare to address the challenges posed by external imbalances, an increasingly aging population, rising inequality, a shrinking workforce, and environmental degradation (The World Bank, 2012). The problem is that the policies pushed by the World Bank do not consider these issues unique to each economy.

References

Masters, J., & Chatzky, A. (2019, April 9). The World Bank Group’s Role in Global Development. Council on Foreign Relations, https://www.cfr.org/backgrounder/world-bank-groups-role-global-development

The World Bank. (2012). China: The case for change on the Road to 2030. Retrieved from https://www.worldbank.org/en/news/press-release/2012/02/27/china-case-for-change-on-road-t-030

The World Bank. (n.d.). The World Bank in China. Retrieved from https://www.worldbank.org/en/country/china/overview#:~:text=Since%20China%20began%20to%20open,the%20world%27s%20second%20largest%20economy

Viddler. (2014). China: The Case for Change on the Road to 2030 – World Bank President Robert Zoellick [Video]. McGraw-Hill Irwin, https://www.viddler.com/embed/b7cc8016/?f=1&autoplay=0&player=full&disablebranding=0%C2%A0

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