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21793 Volume 1 Public Disclosure Authorized Public Disclosure Authorized .t Public Disclosure Authorized Public Disclosure Authorized Annual Report .200 ANNUAL REVIEW AND SUMMARY FINANCIAL INFORMATION FILECOPY THE WORLD BANK IN FISCAL YEAR 2000 The World Bank today operatesouit of nearlyioo officesworldwide. Increased presence in dient couintriesis helping tlheBanik better Liunderstand, work imiore closely withl, and providefaster service to clients.Three-fourths of outstanding loans are managedby countrydirectors located outside the Bank'sWashington, D.C. headquarters. Nearly 2,550 staff residein the Countryoffices, representing an increaseof 66 percentover five years ago. C.-htimr Eligible folIBRD FUnds Onla', C-In-r eEfi,ibl, f., 31-d IBRD -d IDA F-nd G.-Id. iCulrEligiblef. IDA 0.ndsOffi. rresfTh. W.r1d B.k O Officoswith C utyDi-I.,rPrE ht Poverty reainsa global problem of bugeproportions. Nearly half of the world's6 billionpeople live on lessthan $2 a day.Poor people lack opportunity. Theylack political power and voice. And Contents theyare extremely vulnerable to sickness, I The World Bankin Fiscal 2000: violence,and natural disasters. The World Data Selected a 2 The World Bank Group Bankisfirmly committedto making 4 Messagefrom the Chairmanof the Board of Executive Directors dfference,with thefull convictionthat 6 Letter of Transmittal 7 Wherethe World Bank Got Its Money in Fiscal zooo progressis possible-with concertedaction. 8 IBRD FinancialHighlights 9 IBRD OperationalHighlights 10 IDA Financialand OperationalHighlights tl Respondingto a ChangingWorld 12 The PovertyChallenge i6 I. Overview,Fiscal 2000 35 II. The Boardof ExecutiveDirectors 38 III. Evaluationof Operations- Taking on the Challenge 44 IV RegionalPerspectives 81 V Thematic Perspectives 105 VI. World BankFinances 145 AnnexTables 165 Index Note 169 List of Boxes,Tables, and Figures Thecomplete Management's Discussion and Analysis, audited Bankfor Reconstruction 171 SelectedWorld BankPublications: financialstatements of theInternational andDevelopment, audited financial statements of theInternational RecentTitles DevelopmentAssociation and the Interim Trust Fund, Appendixes, arepublished in a separatevolume as 173 List of Part I and Part II Member Countries andProject Summaries BankAnnual Report 2000: Financial Statements and 175 World BanikWeb Sites The World Appendixesto the Annual Reportand are availableon the Intemet 176 Acronyms at www.worldbankorg/html/extpb/annrep/. TheWorld Bank in FISCAL2000 HIGHLIGHTS > Steadyimprovements in the Fiscal 2000 qualityof ongoingprojects mean that billions of dollarsare havinga much greaterbeneficial impact on Selected D ata development.The shareof proj- ectsat risk of not achievingtheir (millionsof U.S. dollars) development objectives fell to an estimated15 percent of the total in fiscal2000, or roughlyhalf the rate of fiscal 1996. - New lendingcommitments dec- linedto $15.3billion, as peakde- Fiscal zooo Fiscal 5999 mandsfrom lastyear's IBRD "crisis" Lending countriessubsided in linewith the New Commitments strongglobal economic recovery. I 10,919 22,182 > Seven countries qualified for IDAa 4,358 6,813 debt relief underthe enhancedIni- Totl 1,272899tiative for HeavilyIndebted Poor Total I5,2761 28,995 0 Countries,six of them in Africa. IBRD Loans Outstanding 120,104 117,228 Relief from all creditors to these IDA Credits Outstanding 86,643 83,666 seven countries, under the Disbursements enhancedframework, is expected IBRDa 13,332 18,215 to amountto $8.4billion over time. IDAa 0 5,177 6,023 - TheBank and the International Total8,50977 64,0238 MonetaryFund began to helpcoun- Total : 0 I8,5091; 24,238 \ 0 tries preparePoverty Reduction Strategies,which are becomingthe IBRDFinances basisfor debt reliefand concession- Net Income 1,991 1,S18 al lendingby the Bank,the Fund, Borrowings Outstandingb 110,379 115,739 andother development partners. Subscribed Capital 188,606 188,220 !- The Bankannounced up to $1 billion supportto help IDAborrow- I4.quityE Capital-to-loans ratio 2I.2% 20.7% : ers combatHIV/AIDs, andto address priority socialproblems with Cofinancing and Trust Funds cross-borderor globaldimen- Cofinancing 9,341 11,350 sions-with a specialfocus on Cofinancing/World Bank Lending tatio 61.1% 39n1% Africa, and active partnership in Trust Fund Contributionsc 1,769 1,568 the GlobalAlliance for Vaccines and Immunization. Trust Fund Disbursementsc 1,659 1,333 a. ExcludesIDA HiF-c grants but includes Intenm Trust Fund. b. Before swaps, net of premium/discount. c Includesall World Bank Group Trust Funds. The WorldBank Group T he World Bank is a development institution whose mission is to fight poverty and improve livingstandards for people in the developing world. It provides loans, policy advice, technical assistance, and knoWledge-shar- ing services. IBRD and IDA-together the "'World Bank" or "the Bank"- are owned by member countries that carry ultimate decisionmaking power. The \NVorldBank Group today consists of five closely associated institutions: THE INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT F Established194$ a i8i Mfembers Cumulativelendilg: $349 4 billion Fiscal 2ooo lending:$1O.9 billionlfer 97 new operationsili 41 colltrils IBDprovides loans and development assistance to middle- income countries and creditworthy poorer countries. \Voting power is linked to members' capital subscriptions, which in turn - are based on each country's relative economic strength. IBRD is - 5 not a profit-maximizing organization but has earned a net aRestored roads in Peru'sremote areasgive poor, income every year since 1948. isolated villagers accessto market centersand economic and social opportunities. IDAZ _ :THE w INTERNATIONAL DEVELOPMENT ASSOCIATION Established1960 _6i MUembers Cumiulative lending: si0. llion _ Fiscal 2ooo lendinogS 4.4 billionfor fl6 new opertitonsin $2 coliitries US 4 ^InDA is the Bank's concessional lending arm and provides key stipport for the A ;: : jBank'spoverty reduction mission. IDA assistance is focused on the poorest 5_ >,~'- ,..4 J - t' ,> cotntries, to which it provides interest-free loans (termed "credits") and other services. In fiscal aooo, Si countries were IDA-eligible. Rural communities participate actively in efforts to improve food security and nutrition standards in Benin. THE INTERNATIONAL FINANCE CORPORATION t Established1956 174 Members C'oininttedportfolio S2l 7 billion i fiscal 2000 conimitments:S2 4 btllion for 75 coititrnes sFc promotes growth in the developing world by financing private sec- tor investments and providing technical assistance and advice to govern- ments and businesses. In partnership with private investors, IFC provides both loan and equity finance for business ventures in developing countries. - - A village-level cellular phone network, enabled through GrameenPhone, empowers rural women entrepreneurs in Bangladesh. Noncommercial guarantees help privatize commercial vehicle services in Lesotho, raising their quality and efficiency. THE MULTILATERAL INVESTMENT GUARANTEE AGENCY Establiskedi988 ig2 Meimbers Cuniulatix'eGuarantees issued: 57.1 bullion Fiscal 2000 Guaranteesissued: $1.6 billion - MIGA helps encourage foreign investment in developing countries by providing a U_ ~ guarantees to foreign investors against loss caused by noncommercial risks. MIGA also provides technical assistance to help countries disseminate information on investment opportunities. I,C S I D' l tS THE INTERNATIONAL CENTRE FOR L SETTLEMENT OF INVESTMENT DISPUTES ' Established1966 131 MVenber-s Total easesregistered: 75 Fiscal 2000 easesregistered: 12 ICSID helps to encourage foreign investment by providing inter- national facilities for conciliation and arbitration of invest- ment disputes. ICSID also has research and publishing activities in the areas of arbitration law and foreign invest- ment law. A port terminal concessionin Argentinais being arbitrated in ICSID. MESSAGE FROM THE CHAIRMAN OF THE BOARD OF EXECUTIVE DIRECTORS new millennium is beginning. For people in poverty are an asset, not a liability It is Athe World Bank, it is a time to ask imperative that we give them opportunities, that we ourselves, how can we improve empower them, and that we ensure their security. our effectiveness in the fight Drawing on these lessons, our work is guided against poverty? It is also a time by the following principles: to act: with urgency and with responsibility. > Country ownership: A country's progress Urgency, because roughly two billion more peo- depends fundamentally on its directing the policy ple will be joining us on this planet in the next 25 agenda. Actions taken without broad buy-in have years, and we must be ready for them. Responsi- too often turned out to be unsustainable. Success bility, because the 2.8 billion poor who currently requires that consensus-building by all stakehold- live on less than two dollars a day are our fellow ers be part of the action agenda. human beings, and not just a statistic. >! Long-term integrated approach: To achievesus- Achieving a world free tainable growth, crucial for poverty reduction, pover- of poverty is an enormous ty reduction strategies must be multidimensional. and complex undertaking. These strategies must address macroeconomic as And solutions are far from well as social, environmental,and institutional needs. simple. The challenges are Progress must occur on all fronts, ranging from gov- 4 multidimensional; they call ernance, anticorruption, and judicial and financial for people, groups, and systems to health, education,