2018-2019 Trust Fund Annual Report

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Value Proposition of Trust Funds

The 2018-2019 Annual Report highlights how trust funds help the World Bank Group attain its institutional goals—to end extreme poverty and promote shared prosperity. Trust funds support the achievement of these goals by providing financial resources, contributing to the knowledge agenda, and leveraging the Bank’s convening power and global and local presence to contribute to country, regional, and global development.

Main Messages

  • The main thematic focus of this year’s report is on highlighting the value proposition of the World Bank Group (WBG) trust funds as an important source of development finance in response to changing global priorities, essential for a stronger, better, more flexible institution.
  • Trust funds are used strategically to complement the core WBG funding. They enhance global, regional, and country-level knowledge; provide targeted support to clients as a complement to IBRD and IDA funding; and provide funding to countries and clients that cannot receive IBRD and IDA funding.
  • One of the key factors hampering progress in achieving the Sustainable Development Goals (SDGs) is a global financing gap estimated at $3 trillion to $5 trillion a year. Trust funds help close that gap by helping governments build their capacity to mobilize revenue and manage public expenditure and public debt.
  • The World Bank Group identified five global issues as its institutional priorities: climate change, crisis response, jobs, gender, and infrastructure. In each of these focus areas, trust funds play a vital role, complementing IBRD, IDA, and IFC. 
  • The current portfolio contains many trust funds, most are very small in size. This results in modest effectiveness and risks of duplication. Also, the higher costs of coordination and reporting affect the efficiency of these small trust funds. Therefore, the Bank is engaged in an ambitious trust fund reform effort as part of improving the business model.

Key Links

MULTIMEDIA

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Development Results

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Pillar 1: Serving All Clients

Trust funds enhance global, regional, and country-level knowledge; provide targeted support to clients as a complement to IBRD and IDA funding; and provide funding to countries and clients that cannot receive IBRD and IDA funding.

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Pillar 2: Supporting Resource Mobilization

One of the key factors hampering progress in achieving the SDGs is a global financing gap estimated at $3 trillion to $5 trillion a year. Trust funds help close that gap by helping governments build their capacity to mobilize revenue, manage public expenditure and public debt, and improve their procurement and public financial management systems, and they support the development of innovative financial solutions and mobilization of new, nontraditional sources of development finance.

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Pillar 3: Leading on Global Issues

The Forward Look identified five global issues that the WBG would focus on: climate change, crisis response, jobs, gender, and infrastructure. In each of these focus areas, trust funds play a vital role, complementing IBRD, IDA, and IFC.

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Pillar 4: Improving the Business Model

The focus of actions under this pillar is to increase the development impact, effectiveness, and efficiency of trust funds. The portfolio contains a large number of trust funds, most very small in size. This means that their strategic alignment and effectiveness are modest, there may be potential risks of duplication, and need for improving coordination.