| The World Bank supports country development programs through a range of lending, analytical, and advisory services that reflect country priorities, need, performance, and institutional capacity as well as Bank comparative advantage. Building on its assessment of a country's development challenges covering the range of structural, social, environmental, institutional, and macroeconomic policies, the Bank develops a business strategy which aims to help the country carry out its own vision for growth and poverty reduction. This approach was set out in the paper Supporting Country Development in Low- and Middle-Income Countries, which was discussed by the Development Committee in September 2000.1 The paper focused on the Bank's support for low-income countries, which has been strengthened through the Poverty Reduction Strategy Paper (PRSP) and the Heavily Indebted Poor Country (HIPC) initiatives partnered with the IMF. More recently, the Bank looked into its approach to supporting development in middle income countries, in the context of the Task Force on the World Bank Group and Middle Income Countries.2 Against this background, the Bank also has been considering its experience with adjustment lending as part of its periodic review of operational policies and lending instruments. In the recent Adjustment Lending Retrospective, the Bank took stock of major developments in adjustment lending over the last two decades and examined the appropriate use of adjustment lending within the Bank's menu of lending instruments.3 In that context, the retrospective, which was discussed by the World Bank Executive Directors on May 9, 2001 also reviewed the use and design of conditionality. Building on the retrospective, and as part of a broader effort of Bank operational policy reform, work has begun on an update of the Bank's Operational Directive (OD) 8.60, Adjustment Lending Policy, and its conversion into the Operational Policy/Bank Procedure (OP/BP) format. Over the next few months, the Bank will prepare an issues paper that outlines key options for the proposed policy update, and where appropriate, possible modifications of the existing policy on adjustment lending. The issues paper will be discussed with the Executive Board and will be made available to the public, serving as the basis for a series of face-to-face consultations with representatives of member governments, members of civil society, and other development partners, that will then be held around the world. This work has coincided with the IMF's initiative to streamline conditionality. The paper Strengthening IMF-World Bank Collaboration on Country Programs and Conditionality reviews the developments in both the IMF's and the World Bank's operations that have led to an increased need for collaboration both in the design of their support for country programs and in monitoring and evaluating country performance with respect to the attached conditions. The key message of this paper is that enhanced World Bank and IMF staff collaboration on conditionality will strengthen program design, but only if there is enhanced staff cooperation throughout the country program cycle. The paper was prepared jointly by the staffs of the two institutions and was discussed by the Bank Board of Executive Directors on July 26, 2001 (see attached Chairman's Summary, dated August 14, 2001) and by the IMF Board of Executive Directors on July 25 and July 27, 2001. The attached final version reflects the comments of the Executive Directors' of both the Bank and the Fund. The IMF is also posting the paper on its website. 1 See Supporting Country Development: World Bank Role and Instruments in Low- and Middle-Income Countries (80KB PDF) (DC/2000-19), September 8, 2000 2 See Supporting Country Development: Strengthening the World Bank Group's Support for Middle-Income Countries (DC2001-0005), April 10, 2001 3 See Adjustment Lending Retrospective (SecM2001-0215), April 2, 2001 For more information, see
Strengthening IMF-World Bank Collaboration on Country Programs & Conditionality (235K PDF)
World Bank-IMF Collaboration on Conditionality: Chairman's Summary (210K PDF) |
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