FOR IMMEDIATE RELEASE

The World Bank

News Release No. 2001/018/S	Contacts: Caroline Anstey (202) 473-1800
Ivar Slengesol (202) 458-4897
www.worldbank.org/developmentnews 

WORLD BANK ANNOUNCES FY00 OPERATIONAL RESULTS

WASHINGTON, July 31, 2000The quantity of World Bank lending declined last year as developing countries emerged from crisis, but the quality of lending is up. 

The global economic recovery contributed strongly to the trends in World Bank lending over the last year, as successful economic reforms in many emerging markets restored their access to international capital markets.  Bank lending to crisis-affected borrowers—Korea, Argentina, Indonesia, Brazil, Russia, and Thailand—fell to below US$2 billion in fiscal year 2000 (FY00), from US$13 billion last year.  

Overall, new lending commitments from the World Bank to client countries were down to US$15.3 billion in FY00, which ended on June 30.  This compares with US$29 billion in FY99.  Disbursements in FY00 stood at US$18.5 billion, down from US$24 billion in FY99.  

The World Bank figures include both the market-rate loans made by the International Bank for Reconstruction and Development (IBRD) and concessional loans made to the world’s poorest countries through the International Development Association (IDA). 

IBRD loan commitments in FY00 amounted to US$10.9 billion for 97 projects, compared with US$22.2 billion for 131 projects in FY99. Country specific factors also influenced IDA borrowing by the world’s poorest countries, several of which were affected by civil unrest and war.  IDA commitments were US$4.4 billion for 126 projects in FY00, compared with US$6.8 billion for 145 projects in FY99.

Steady improvements in the quality of ongoing projects through better preparation, greater selectivity and more effective supervision mean that billions of dollars for borrowers’ projects are being used more effectively, with a much greater beneficial impact on development. The share of projects that are at risk of not achieving their development objectives fell to an estimated 15 percent of the total in FY00, or roughly half the rate in FY96.

	“World Bank financial commitments are increasingly focused on where they have the greatest impact on poverty reduction.  Continued increases in the quality of Bank assistance show that we are on the right track,” said James D. Wolfensohn, World Bank President.

	For both IBRD and IDA countries, lower lending also reflects a trend toward smaller-sized operations, as countries have needed more support for the social sectors, public sector management, and institution buildingrather than large-scale physical infrastructure investment, where the private sector is assuming a growing role.  

	Innovative new lending instruments that support more flexible, step-by-step capacity building in developing countries and that promote learning and innovation—aimed at reducing risk and building institutions to increase aid effectiveness—also imply smaller operations.  As a result, average loan size in FY00 continued to decline to US$69 million, compared with US$94 million 10 years ago. 

	The Bank has continued efforts to improve countries' access to private capital. In a first-time use of the new instrument, the Bank issued a US$250 million policy-based IBRD guarantee in support of a sovereign bond issue by Argentina that raised US$1.2 billion on the US dollar bond market in October 1999. 

Regional IBRD/IDA lending commitments
Regions	No. of IBRD Projects	IBRD Commitments
US$ billion	No. of IDA Projects	IDA Commitments
US$ billion	IBRD/IDA Combined No. of Projects	IBRD/IDA Combined Commitments
US$ billion FY99	IBRD/IDA Combined Commitments
US$ billion FY00	
AFR	3	0.1	66	2.1	69	2.1	2.2	
EAP	17	2.5	11	0.5	28	9.8	3.0	
ECA	27	2.7	20	0.3	47	5.3	3.0	
LAC	32	3.9	8	0.2	40	7.7	4.1	
MNA	13	0.8	5	0.2	18	1.6	0.9	
SAR	5	0.9	16	1.2	21	2.6	2.1	
Total	97	10.9	126	4.4	223	29.0	15.3	

	World Bank lending continued to reflect the varying demands and needs of borrowing countries in different regions of the globe. Latin America and the Caribbean accounted for the largest share of lending commitments (US$4 billion) during FY00, followed by the Europe and Central Asia and the East Asia and Pacific regions with $3 billion each.  Sub-Saharan Africa and South Asia each accounted for just above US$2 billion, and the Middle East and North Africa for almost US$1 billion. 

IDA lending commitments in FY00 reflected a number of country-specific factors—especially policy and institutional performance and conflict situations in Asia and Africa—and IDA’s increasing focus on selectivity and aid effectiveness.  Overall, Sub-Saharan Africa accounted for almost half of IDA commitments.

Regional disbursements in FY00 were: US$6.1 billion to Latin America and Caribbean, US$3.7 billion to Europe and Central Asia, US$3.6 billion to East Asia and Pacific, US$2.5 billion to South Asia, US$1.9 billion to Africa, and US$744 million to the Middle East and North Africa.

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