1 Introduction

Increased globalization over the last decades, occurring in parallel with rapid economic growth in middle-income countries, has increased the sense of economic, social, and ecological interdependence while intensifying concerns over a growing list of global problems. Nowadays global public goods (GPG s) as such and sustainable growth concern all stakeholders, including international organizations and rich and poor countries. Moreover, the current economic and social situation poses the greatest challenge to international development cooperation and the aid system since World War II.

The spread of communicable diseases (especially the COVID-19 pandemic), the multilateral trade and financial system structure of today, the impact of climate change, international security etc. clearly illustrate the urgency of concerted global actions of all actors in international relations, with the World Bank/World Bank Group (WB/WBG) at the forefront.

The contribution of this chapter to the main objective of this monograph is that it provides the current view on the role of the World Bank in fostering sustainable growth in the world via increasing its involvement in the management and production of global public goods parallel to its statutory activities focused on planned financial support for member states. The main aim of this section is to analyze and suggest ways in which the World Bank can strengthen its abilities in GPG s production to assist member states to meet their development objectives together with sustainable growth goals. The basic question that should be answered in these analyses refers to the backgrounds of changes that took place in World Bank priorities over the decades and the ways in which this organization is able to combine its main statutory aims with delivering GPG s to foster sustainable growth.

The crisis and challenges of today have among others resulted in a particularly painful widening of the gap between the financial needs of developing countries and the actual possibilities of financing them by the main actors in international relations. Unfortunately, this process may be more difficult than ever as the economic crisis resulting from the pandemic and the war in Ukraine has hit both developed and developing countries, i.e., traditional aid donors as well as recipients. Regardless of this, the World Bank underlines that it has a number of comparative advantages over other institutions: a global presence, a repository of best practices, financial acumen, leadership in global public goods, and an established role as an international development catalyst. According to Vikram Nehru, former World Bank chief economist for East Asia, while the Bank has always represented a tiny share of public investments in most countries, its strength comes from leveraging its lending with ideas.

This chapter is organized as follows. A brief introduction defines the research problem and covers the aim and research questions. Section 1 deals with the structure of the WBG, its main statutory goals, and the role of the International Bank for Reconstruction and Development in the WBG, as well as changes in its policy priorities that took place over the decades. Section 2 depicts the endeavors as well as difficulties connected with the WB policy towards GPG s, their management, production, and distribution, with special attention to the influence of the crisis caused by the pandemic. In Section 3 the backgrounds of WB finances are discussed, as well as the trends of some new financial instruments. Finally, the conclusion sums up the chapter and elaborates the answers to the research questions.

2 World Bank Group: Structure and Priorities

The World Bank Group (WBG) has always played a special role in the process of contributing its knowledge and financial support to less developed countries and regions, as well as taking part in collective actions of other international organizations on GPG s.

The WBG is made up of five organizations:

1. –International Bank for Reconstruction and Development (IBRD)
2. –International Development Association (IDA)
3. –International Finance Corporation (IFC)
4. –Multilateral Investment Guarantee Agency (MIGA)
5. –International Centre for Settlement of Investment Disputes (ICSID)

The largest and oldest institution in the WBG is undoubtedly the International Bank for Reconstruction and Development, which began its activity in 1945. The World Bank is not a bank in the strict sense of the word. It is the largest and most well-known development bank in the world, which in addition is an observer in the United Nations Development Group. The original goal of the IBRD was to finance the reconstruction and development of member states by facilitating capital investment for productive purposes, including the reconstruction of economies destroyed during the war and the adaptation of their productive capacities for peaceful purposes as well as stimulating their development through the provision of loans, guarantees, risk management products, and advisory services. The activities of the World Bank are based on the provision of the following functions: providing financial assistance, performing fiduciary functions for private and public institutions from member states, providing advisory and analytical services and, in recent years, carrying out activities aimed at strengthening their development capacity to increasing their welfare through poverty reduction, development financing,¹ providing loans for the development of health-care and education systems, advanced good quality infrastructure, and environment protection² (World Bank, 2007a).

In the 1950s, the priority of the IBRD was the development of broadly understood infrastructure by granting loans for projects such as the construction of dams, power grids, irrigation systems, and roads. In the next decade – the 1960s – loans were aimed mainly at restructuring agriculture and solving the problem of poverty and malnutrition. In the 1970s, attention was focused on health and education, i.e., on general aspects of hygiene, prevention, broadly understood health, fighting illiteracy, better access to education. In the 1980s, the IBRD’s attention was focused on new financial instruments aimed at stabilizing the economies of less developed countries. The new element in the Bank’s policy was also inviting experts from various fields, who supported the Bank with their knowledge in different areas, including in the field of national economic stability. In the 1990s, more attention was paid to social life and the role of the individual in society, cultural heritage, and also to the issue of climate change, which at that time was becoming the most important global public good in the world (Gutner, 2016, pp. 211–215). In 1991, the WBG formed the Global Environment Facility (GEF) to promote environmentally friendly and sustainable economic development (Independent Evaluation Group, 2013). After the 1992 Earth Summit in Rio, GEF became a separate institution (in legal terms it is still a part of the World Bank), being the greatest public funder for projects aiming to globally improve environmental conditions, bringing together 182 countries in collaboration with international institutions, civil society organizations and the private sector to solve global environmental problems while supporting domestic sustainable development initiatives. Moreover, the World Bank received authorization to administer the Green Climate Fund, which is an operating unit of the UN Framework Convention on Climate Change (UNFCCC), thus confirming its authorization and capabilities to produce and manage GPG s. At that time the World Bank also became the trustee of the Adaptation Fund established under the 1997 Kyoto Protocol, which maintained that the Fund would be financed with a 2% trading fee for carbon dioxide emissions allowances under the Clean Development Mechanism. The funds thus raised were supposed to bring ample benefits to developing countries by increasing the funds to foster sustainable development because of financing projects for the countries to reduce exhaust gases emission into the atmosphere. This was a novel approach to finance, albeit seriously defective for several reasons, including an objection on the part of potential beneficiaries who fear such a policy may, in their case, reduce the pace of their economies’ growth. Hence, with varied attitudes of the signatory states of the Kyoto Protocol, the Adaptation Fund become a non-credible financing source (Evans & Davies, 2015, pp. 63–64).

In the first decade of the 21st century, the World Bank’s policy focused on delivering to beneficiaries the financial support and knowledge to solve problems related to state governance. In 2000, for the first time, the IBRD also indicated directly and assessed its place in GPG s production (Narayan et al., 2018, pp. 200–208). One of the first basic documents on the WB’s role in the production of GPG s was also prepared during this period as a joint background report of the WB/IMF (World Bank, 2007b). Notwithstanding, the strategy sparked criticism for focusing mainly on the existing traditional lending operations of the WBG, with just a little indication of something “new” (Birdsall, 2012). For the IBRD, as a primarily country-focused development institution, the key became its ability to work consensually with partner countries combining national development priorities and global public goods (World Bank, 2001). The Critical Ecosystem Partnership Fund (CEPF) established in 2000 by the GEF, the European Union, the government of Japan, L’Agence Française de Développement, Conservation International, and the World Bank is an example of a global program that provided financing and technical support to non-governmental organizations (NGO s) and private sector partners in order to protect important ecosystems with a significant impact on local, regional, and global development. To date, the program has provided grants to support over 3,000 projects globally, ranging from US$20,000 (small grants) to US$150,000 (large grants).

The second decade of the 21st century, i.e., the period between 2010 and 2019, was a time of focusing on so-called big data and the flow of personal data. This is the most common topic concerning not only the data flow of the most important global institutions, but also the security of citizens and the problem of government surveillance (World Bank Group, 2021).

New circumstances of the regional and global situation since 2020 have brought about adjustments in emphasis, instruments, and responses based on GPG s production. And so in the current decade, the main objectives of the World Bank Group cover human capital, the environment,³ smart cities, equality for women,⁴ threats and armed conflicts, and pandemics (HIV, Ebola, malaria, SARS, COVID).

3 The Role of the World Bank in Promoting Global Public Goods

Building on the Samuelsonian public goods theory, there is a proposition that multilateral institutions, such as the World Bank, should undertake the mission of providing global public goods. The World Bank is often considered the most qualified institution for this task. Such a proposal has solid theoretical and practical foundations, as an organization whose mission are sustainable development and global prosperity is promoting the idea of GPG s ever more audaciously. The GPG s themselves have become an important constituent of the Bank’s strategies (Ravallion, 2016). It is also beyond doubt that the World Bank still mainly provides private goods and resolves the problems of its beneficiaries, while global hazards are only becoming more conspicuous in its policy. Still, many researchers of the problem find it is necessary to analyze the Bank’s actions from three perspectives, i.e., nationally, regionally, and globally (Kaul & Grunberg, 2016, p. 27). Such a holistic approach to the World Bank shows that its actions undertaken at particular levels are complementary and thus contribute to producing GPG s by giving the Bank’s members an opportunity to solve global problems. Hence, it may be concluded that certain programs and products offered by the Bank, be it to one country only, should be considered a contribution to GPG s by the so-called spillover effect. This is because normally lending-based activities carried out by less developed countries also impact other countries of the region, and often of the world. For instance, a loan given to an African country to fight malaria may consequently stabilize health conditions regionally or globally, and it is connected with measures undertaken by other organizations, e.g., the WHO, in this area, which ultimately makes the good a cumulated GPG. In turn, many economists are of the view that in practice, the Bank’s production of GPG s is still too marginal, as the institution mainly focuses on specific problems of member states rather than global issues. However, despite critical and prudent opinions of numerous experts (Ravallion, 2016), some researchers find that the World Bank Group (IDA, in particular) itself is a GPG (Kanbur, 2002, p. 24).

Undoubtedly, numerous products and services rendered by the Bank are not only of a local, but also regional and global nature. This is because the World Bank offers innovative financial solutions, including financial products (loans, guarantees, and risk management products), as well as access to knowledge and advisory services for governments on a domestic and regional level. It finances investment projects across all the sectors and provides technical support and expertise at each stage of a project. IBRD resources not only provide the borrowing countries with the required financing, but they are also a tool for a global transfer of knowledge and technical assistance. Advisory services in the area of sovereign debt and assets management support governments, official sector institutions, and developmental organizations in building transparent and stable institutions that guarantee protection and strengthening of the public finance management system, the improvement of the investment climate, the elimination of bottlenecks, and state enhancement. IBRD support also includes preference interest long-term lending for the most disadvantaged member states, as well as public and private business entities (on receiving government guarantees), and technical assistance. All the above are aimed at combating poverty, being a public anti-good, and financing sustainable development by supporting such social life areas as health care, education, environmental protection, and infrastructure development. In return, however, the countries which benefit from the said support are required to undertake important political and economic measures, such as combating corruption, the growth of democracy, or the expansion of the private sector. Over the consecutive decades of its operations, the World Bank passed plans for the reconstruction and development of the world, plans allowing for global economic, social, and political changes, while the financed projects were to help implement the plans. Accordingly, the researchers basically agree that while the Bank’s specific programs and products target member states, most of them may and should be considered as a contribution to the production and management of GPG s because of the abovementioned “spillover effect” of the provided lending (Kenny et al., 2018, p. 12). Simultaneously, only certain activities of the World Bank may be considered core activities from a GPG production perspective. Trust funds managed by the Bank are a flagship example in this respect, which is elaborated later on in the next part of this section (Aramonte & Avalos, 2020). Experts maintain that the following are the most important GPG s with respect to their significance for development and dependence on assistance financing:

1. –Overseeing, controlling, and fighting communicable diseases
2. –Sustainable management of cross-border natural resources, such as the atmosphere, forest and marine ecosystems, fresh water, and fishery
3. –Knowledge creation for development

Conceptually, what should be deemed as the purest form of activities classified as GPG s in the World Bank are research and research findings published globally over the internet, publishing data, reports, and a variety of scientific and expert studies. This is because the IBRD is one of the world’s most prominent development research centers and a knowledge “bank” employing the world’s best experts who create tools to support development, such as the Doing Business project (provided objective measures of business regulations and their enforcement), the World Development Report (an annual report providing in-depth analysis of a specific aspect of economic development), the Development Gateway (an interactive portal for sharing information on development and poverty reduction); AIDA (a complex database on developmental projects), and DG Market (an international database on the World Bank’s procurement procedures).

While researching the World Bank in the sense of its impacting sustainable development and the production of GPG s, it is vital to remember that the world used to be a completely different place 80 years ago than it is now. In the early 21st century the Bank took interest in global public goods, and it made the provision of global public goods strategic. It is beyond doubt that the Bank’s involvement in partnerships, as well as regional and global programs, varied, and with varying outcome. Some of the effects were significant achievements indeed. Should the bank change radically and become a “global institution addressing the global challenges of the future through global collective action” (Birdsall & Subramanian, 2007)? The World Bank may and should play an important role in providing such global public goods that pursue its main goal of reducing poverty and thus improving global prosperity. Moreover, the IBRD is engaged in actions that concern, among others, climate change and solving the problem of global warming, monitoring, and supervision of the relevant agreed measures undertaken, as well as initiating steps for enhancing R&D with regards to new technologies for poor countries. Climate change is included in the greatest investment program being part of the environmental portfolio the World Bank (and possibly the world) has undertaken in terms of providing GPG s. In the years 2010 to 2021, a significant portion of the World Bank’s Country Assistance Strategies (CAS s) and Country Partnership Frameworks (CPF s) concerned climate change. A good example of environmental a GPG initiative is the Global Partnership founded in 2012 to raise US$1.5 billion for the world’s overfished, polluted, and warming oceans, to double the number of protected marine areas, and to rebuild fish stocks. It is a coalition of governments, NGO s, scientists, and businesses committed to mobilizing at least US$300 million in catalytic financing to leverage another US$1.2 billion from businesses, NGO s, and other institutions (Evans & Davies, 2015, p. 64).

So as to face up to the challenge, the Bank is taking up numerous initiatives aimed at linking its own development agenda to global public goods (World Bank, 2020a). Currently, there is in fact no single institution responsible for providing global public goods on a worldwide scale. For instance, the Global Polio Eradication Initiative is managed by the WHO, but it is also financed from other intergovernmental sources. Global attempts to prevent climate change are coordinated under a UNFCCC umbrella agreement. The impact of international marine transportation on the environment is solved in agreements negotiated by members of the International Marine Organization. The list is long. The point is, however, that various public goods imply various problems, require various technical expertise and are of varying importance for various country groups. Thus, it is not possible for the World Bank to accept the role proposed by Birdsall and Subramanian (2007), and it is not obviously necessary. Many of these organizations work very effectively to produce global public goods. Hence, leaving these issues up to some selected organizations only could, in practice, result in numerous errors. Concomitantly, the World Bank must not just stand by only because the global efforts in some impact area of a given GPG are the responsibility of other organizations or because some management or supply measures have failed (Kopiński & Wróblewski, 2021).

To summarize, given the current trends in the global economy the Bank will need to work with partner countries combining national development priorities with regional and global concerns. According to the World Bank Framework of 2007 (World Bank, 2007a) this requires the Bank to undertake activities in the following areas:

1. Enhance cooperation with partner countries on the integration of country priorities and global/regional public goods. Management will explore how best to ensure a more systematic treatment of global public goods at the country-level, working collaboratively with partner countries and building on the Bank’s diversified tools of country assistance.

2. Strengthen its capacity for advisory services and lending related to global and regional public goods. To be credible in its advice, the Bank will continue to upgrade its staff expertise in areas of emerging priority and better align Regions and Networks in implementing the global public goods agenda.

3. Participate strategically in global partnerships. Partnerships are an important instrument for pursuing critical global public goods objectives, and the Bank has many vehicles to participate in global initiatives. The major challenge is selectivity, to ensure that the Bank achieves the greatest impact from its interventions. Management sees a need to explore the coherence of the Bank’s large trust fund portfolio in support of global partnerships and to identify gaps in critical priorities.

4. Explore new financing modalities for global public goods. Building on recent experiences (for example with the International Financing Facility for Immunization and joint IBRD/IFC-funded projects), Management will continue to support new financing instruments, particularly if they help to address market failures (as in low-carbon investments) and if they contribute to leveraging private resources in the infrastructure, energy and health sectors. Such instruments should be pursued for global public goods activities that fill extraordinary and critical gaps in innovation, that provide major incentives for collective action, and those that would have a catalytic impact on other sources of funds.

5. Continue to promote informed debate on global issues, and advocate constructively for developing countries. In particular, the Bank should contribute to: (i) a durable and equitable framework to reduce greenhouse gas emissions; and (ii) a successful conclusion of the Doha Round of trade negotiations.

6. Increase action at the regional level. Concentrating on regional approaches to regional and global public goods may be a more relevant operational approach in some problem areas – such as water, energy, transport and health – and is likely to continue to gain in importance. The Bank can assist in developing common regulatory frameworks and shared financing options, and will enhance lending for multi-country investments addressing global public goods at the regional level. (World Bank, 2007a, pp. v–vi)

4 World Bank Financing of GPG s

The operations of the World Bank chiefly rest on providing financial assistance. The World Bank’s funds derive from member states’ contributions, repayment of loans incurred earlier on and from the issue of bonds on global capital markets. The initial capital is share capital, with the largest portion of the Bank’s funds coming from global financial markets. In this way, it was possible to obtain more than US$500 billion to be provided to member states in loans aiming to alleviate poverty and improve global prosperity, from the Bank’s inception to 2021.

As a financial institution, since 1959 it has continued to be AAA rated by rating agencies. Hence, it is by far easier for the Bank to incur low-cost loans and offer average-GDP developing countries access to capital on convenient terms. This, in turn, helps to pursue development projects in a more sustainable manner. Investors perceive the Bank’s bonds as quality securities, and IBRD financing often attracts financing from private sources. The funds that the Bank obtains yearly as profit from equity and non-significant credit margins cover the World Bank’s operating costs and make up the reserve to enhance its annual balance sheet and secure yearly transfer of funds to the IDA for the poorest member states. The Bank’s financial strength rests on the support it has from its shareholders, as well as on an array of financial policies and practices. An effective credit policy and experience in finance and risk management have enabled the World Bank to maintain capital liquidity, diversify its financing sources, and use a portfolio of liquid investments to meet the financial obligations and mitigate risk, including credit and market risk (Beegle & Christiaense, 2019, pp. 247–267). Borrowers may adapt the repayment terms to their needs and debt management capabilities as the loans offered bear fixed and variable interest in many currencies. However, borrowers typically prefer loans denominated in American dollars and the euro. The IBRD also supports its borrowers by providing them with access to risk management tools, such as derivative instruments, including FX swaps and interest rate caps (World Bank, 2019). To conclude this topic, it is difficult to discriminate between actions to support member states and those creating global public goods, while discussing the activities of the World Bank. This is because they may be complementary, as it is often so that a single project combines domestic support with a regional or global component. However, in order to play a more comprehensive role in providing GPG s, the Bank, next to the measures shown, also needs resources primarily dedicated to promote and supply so-called core global public goods. To date, the Bank was chiefly based on trust funds and short-term pilot programs in this area. Generally speaking, they were created by rich Bank members who also took care of the financial side, while the Bank was their administrator and not an institution that impacted their form, purpose, or consumption. It is all the more so that they have so far made up relatively minor funds pools, not integrated with the Bank’s budget, albeit fully dependent on their donors, with the beneficiaries actually being fully dependent on their founders. The Bank’s authorities estimate that approximately US$600 million are spent annually under trust funds for GPG-related actions (Birdsall & Morris, 2016, pp. 5–10). This means that merely 10% of funds fuel, to varying degrees, international or global issues. The World Bank manages and coordinates around 3,000 trust funds by providing accounting, legal, financial, and technical support (World Bank, 2020b). The most renowned and the largest funds the World Bank is involved in are the following: the Global Environmental Facility (GEF, est. 1992), the Climate Investment Fund (CIF, est. 2008), the International Finance Facility for Immunizations (IFFIm, est. 2006) together with the Gavi, the Vaccine Alliance (est. 2000 as the Global Alliance for Vaccines and Immunization), the Global Partnership (est. 2012) or the Consultative Group on International Agricultural Research (CGIAR, est. 1971), the Extractive Industries Transparency Initiative (EITI, est. 2004). Many other, smaller mechanisms have also been created, such as the Critical Ecosystem Partnership Fund (2000), the Global Crop Diversity Trust (2004), the Global Concessional Financing Facility (GCFF, est. 2016), a considerable number of health-sector product development partnerships, such as the Medicines for Malaria Venture (late 1999) and the Drugs for Neglected Diseases Initiative (2003); pilot “pull” mechanisms, such as the Pneumococcal AMC (Advance Market Commitment) vaccination initiative (2006) and the Results Initiative (2012); and World Bank – led mechanisms, such as the Extractive Industries Transparency Initiative (2002) and the State- and Peace-Building Fund (2008). The World Bank Group has also mounted the largest crisis response in its history to help over a hundred low- and middle-income countries fight the health, economic, and social impacts of COVID-19 with its commitments for the 12-month period of fiscal year 2021 totaled US$98.8 billion, including spending for GPG to achieve a more sustainable world and to better protect the poor through digital economy (aimed at building financial sector resilience and resilience in value chains as well as universal, affordable, and high-quality infrastructure), more effective, resilient, and equitable education rebuilding existing systems to be more effective, and investing in remote learning, saving lives, and securing food. Coordination and cooperation – including with the IMF, multilateral development banks, UN agencies, foundations, parliamentarians, the private sector and CSO s – have been key to the WBG crisis response. Close coordination with the IMF throughout the crisis has enhanced debt sustainability analysis, helped countries manage debt vulnerabilities and fiscal space, supported fiscal reforms, and ensured consistency of public spending and policies with macroeconomic stability. Close cooperation with the UN is particularly important in order to provide support to countries and vulnerable communities across the humanitarian – development – peace nexus. Safeguarding global public health requires boosting capacity to stem the spread of the virus everywhere – including in fragile settings and refugee communities. The Bank launched the Health Emergency Preparedness and Response Multi-Donor Fund to complement WBG support and extend vital aid on health emergency preparedness and the response for COVID-19 and future epidemic outbreaks – including to member countries not in good standing with the IDA, the West Bank and Gaza, and Jordan and Lebanon for the benefit of Syrian refugees. The HEPRTF, and any future associated trust funds under that umbrella, have provided an initial amount of up to US$500 million to support countries to prevent, respond to, and mitigate the impact of COVID-19 and future epidemic outbreaks (World Bank, 2021).

To summarize, it should be emphasized that establishing trust funds and grants, whatever the above said defects they may have, enables expanding the operations of the IBRD, in particular in response to natural and other types of disasters, as well as to finance innovations (World Bank, 2020a). Thanks to them, the World Bank Group is able to provide practically instant support whenever the creditworthiness of countries suffering such problems is inadequate. Partner programs are increasingly more often used to engage partners from the non-governmental and private sector, as well as to combine their knowledge and capital with the WBG’s capabilities regarding the provision of pro-development solutions in beneficiary states. As in the case of IDA resources, within the framework of the World Bank, the funds belong to a so-called development finance instrument (DFI), which is managed by the Bank’s Vice President of Development Finance. The structure aims to create and popularize business programs, trust funds and partner programs. The unit helps to develop and manage business operations related to the Bank’s partnership and trust funds. It is a link between external and internal clients as regards the development of program strategy, policy, and management. What is more, the DFI facilitates the creation of trust funds. In the realm of partner relations, it helps to maximize resources from current and new development partners. The unit is in charge of strategic high-profile consultations between the World Bank Group and its development partners (IBRD, 2021). Owing to these consultations, the unit supports actions to identify common development priorities and understand the options offered by various financing channels within the World Bank Group. The DFI also facilitates coordination among the World Bank’s business units by way of early and regular reporting on fundraising actions.

Given the rising interest in sustainable development policy, GPG production, as well as new global challenges emerging (such as pandemics, the war in Ukraine, and mass migration), it seems highly likely that the production and financing of GPG s will continue to increase robustly in absolute terms. Nevertheless, the funds’ origin remains a problem, as the donors, particularly under current circumstances, are unwilling to devote increasing funds to this purpose. It means that the production of GPG s is financed at the cost of the remaining, domestic development assistance. Researchers of the problem show that GPG expenses under multilateral development assistance rose from 5 in 2010 to around 18 in 2019. Still, it needs to be pointed out that the data is not very precise, as the construction of a systematic and regular system of computing the share and structure of the assistance given to GPG s has failed over the years, be it globally, on a particular donor country level, or that of multilateral institutions that spend ample funds under development assistance for this purpose.

5 Conclusions

The mission of the World Bank Group is to enhance security and prosperity of the population by reducing poverty and fostering sustainable development in developing countries, while the main instruments of its policy are loans, guarantees, analytical works, and technical assistance. Undoubtedly, from its very inception, the WBG has contributed to a high level of progress in fighting poverty on a global scale. The World Bank itself, which the many years of its operations testify, is a global institution with almost universal membership and, principally, with a global mission to reduce poverty in the world, to protect the environment and redress the damage humans have inflicted over the last few dozen years. This is because the challenges are still valid and have even deepened, including on account of the world encompassing the pandemic or the war in Ukraine. Around 20% of people in the world are still living on less than US$1 a day, and 46% – on less than US$2; over 3 million people (including 2 million children) are dying each year from diseases for which vaccines exist, 30,000 people are dying every day from hunger, and more than 113 million children do not go to school. There are still insufficient funds to help the poorest. On a yearly average, the official development assistance (ODA) amounts globally to around US$110 billion a day, while US$1,000 billion annually is spent on the military and over US$20 billion annually is spent to feed domestic animals in the US and in Europe. As the World Bank provides lending to the governments of developing countries to finance development projects, economic reforms, and technical assistance, it has to evaluate project applications with respect to whether the project will help the beneficiary country economy, whether it will favor the world’s poorest regions and increase the opportunities for such social groups as youth and women, how it will impact the environment in the long term, whether it can be financed from other sources, and whether the state will be able to continue actions carried out as part of a project once the Bank’s financing is over. It is also for this reason that, in line with the mandate’s objectives, the actions of the WBG are subjected to the needs of particular member states. Such an assumption largely impacts the scope and directions of providing GPG s by the WBG. More funds are needed to finance the purpose: if no additional sources are employed, member states will receive less assistance funds and will compromise their own development goals. Therefore, paradoxically, it is the poorest countries that in practice oppose to such a policy of the World Bank the most, arguing that the money they deserve is being taken away from them. As mentioned before and as the World Bank’s practice to date shows, trust funds should be the best instruments providing the production of GPG s. However, their usefulness depends on how rich they are. As they are still regrettably not affluent enough, they are confined to just a certain group of countries. On the other hand, however, it is important to highlight that the current global governance landscape has given rise to a unique political vacuum. In the face of increasing threats of nationalism and related challenges around the world, institutions like the World Bank are being called upon to play a critical role in addressing these issues. For over 20 years, the focus of the Bank’s work in global public goods has been on five areas endorsed by the Development Committee in September 2000: preserving the environment, controlling communicable diseases, strengthening the international financial architecture, enhancing developing countries’ participation in the global trading system, and creating and sharing knowledge relevant for development (IMF/World Bank,2000). To meet such expectations, its engagement should be consistent with its development mandate and relative strengths to assist countries in achieving sustainable development and increasing their welfare through the production of GPG s. It follows that the operations of the World Bank should be based on financing investment projects which, in the long term, will be important for and favor not only selected countries, but also global development. Therefore, the Bank along with other organizations (including the Global Environmental Facility) should ensure that funds are made available and wisely invested. Other actions of the World Bank with respect to providing GPG s include investments in tropical medicine research, supervision over communicable diseases, and the development of global common resource management institutions. Initiating efforts for international security by “cutting off” Russia from credit and any forms of support with respect to the assault on Ukraine is an example of the World Bank’s involvement in GPG management and production.

The Bank may and should do more in all these areas. This implies that a comprehensive review of the Bank’s policy is necessary to channel its strategy towards better coordination of the Bank’s present policy with the broadly understood goals of providing global public goods to promote development and security. The Bank’s involvement in this respect has been of an on-and-off nature so far, often in response to a crisis or inspired by third parties. The Bank’s overall involvement in the production of GPG s should be more strategic. More ideas should be generated internally. The focus should be on policies and projects that complement the Bank’s core operations, which largely involve domestic lending. The programs and strategies the Bank creates should also point to external partners.