History of the World Bank involvement in Third-World Countries.

The Bank was created at the Bretton Woods Conference in 1944, and although many countries were represented, United States of America and United Kingdom dominated the negotiations; the US dollar was chosen as the main unifying factor of international exchange (“Bretton Woods Conference”). Before 1968, small loans were issued and the applications passed through strict criteria. France was the first country to receive a loan from the Bank and before it was approved, the French had to remove the Communist party and agree to giving priority to the debt repayment. After the approval of the loan, France was closely monitored to make sure the use of the funds were according to the conditions. The World bank usually gained and still gains some power over important issues in the borrowing country not forgetting the profit from the issued loans.

In 1947, the Marshall plan which was the US sponsored program to provide aid to European countries after World War II (“Marshall Foundation”), went into effect leading to many European countries seeking funds from other sources apart from the World Bank. Faced with competition, the Bank focused on non-European countries especially in Africa, Latin America and Asia. Until 1968, the Bank funded income-producing infrastructure in the developing countries like sea ports, highways, railway roads, to enable the loan borrower country to generate income to pay back the loan.

According to a New Times writer Bovard, in 1968, McNamara was appointed new president of the Bank and he made several changes that were particularly meant to attain the highest level of lent loans ever issued before. This was to be done through funding more sectors which included: building multiple airports, schools and agriculture reform, building hospitals. McNamara created a system that gathered the necessary information from borrowing countries and processed their loans faster; this led to increased lending hence rapid rise of third-world debt. From 1976 to 1980, the debt in developing countries increased by 20% and the profit from the interest loans also increased for the Bank.

In 1980, A.W Clausen was nominated as the new president of the Bank, and his policies werefocused on lending to help reduce the third-world debt by making the economies in those countries more efficient. However, in the late 1980's, the UNICEF reported that the structural adjustment programs had been responsible for "reduced health, nutritional and educational levels for tens of millions of children in Asia, Latin America, and Africa."

In the beginning of 1989, the World Bank started being involved and loaning environmental programs and Non-Governmental Organizations in response to the harsh criticisms from many groups of people; this was to tone down the past effects of the developmental policies that had prompted the criticisms. The Bank put in place policies that would promote the environment for development purposes. For example, in 1991, the Bank announced that there was urgent need to protect against deforestation, and approved a US$ 15.9 million in the Global Environment Faculty grant to conserve the Amazon forest, as well as work on adding more 13.5 million hectares to the protected areas in the then following four years (“World Bank Press Release”). The Bank also declared that it would not finance any commercial logging or infrastructure projects that would harm the environment. In order to increase and encourage safe trade of global public goods, the World Bank wanted to ensure the traders were healthy, hence joined forces to fight against contagious diseases such as Tuberculosis and actually joined the Tuberculosis partnership, as well as other deadly diseases like malaria, HIV/Aids, also delivering vaccines in many parts of the world. In addition to that, for the first time, a non-European or non-US candidate- Jim Yong Kim was appointed as the president of the Bank in 2012.

Despite the good changes made, while the world bank represents 188 countries in the world, it is still run by the most economically powerful countries who provide the most funds; therefore, they choose the Banks management and their interests dominate. The United States Committee on Foreign Relations released a report that criticized the World Bank for focusing too much “on issuing loans” rather than on fighting corruption which is the sole cause of poverty in most third world countries; it therefore called on the Bank to “strengthen Anti-corruption efforts.” The money given to most if not all third world countries has strings attached, that is the country is required to spend it on goods from the one of the economically powerful countries that indirectly run the World Bank. Such transactions don't take into account the poor country's market place, therefore making it hard for that country to rise above the current situation. Many developing countries have become so dependent on the money from the world bank that they feel they can't exist without it; this has encouraged laziness to make alternative local sources of income. When there's a lot of money given to a country, inflation occurs leading to that country's currency losing value. Also, there are big sums of money given for military equipment and weapons which majorly encourages wars.

Works Cited

"Bretton Woods Conference | The Institute for New Economic Thinking."The Institute for New Economic Thinking. N.p., n.d. Web. 29 Sept. 2013. <http://ineteconomics.org/initiatives/conferences/bretton-woods>.

"The Marshall Plan."The Marshall Plan. N.p., n.d. Web. 27 Sept. 2013. <http://www.marshallfoundation.org/TheMarshallPlan.htm>.

"The World Bank Vs. the World Poor."The World Bank Vs. the World Poor. N.p., n.d. Web. 28 Sept. 2013. <http://www.cato.org/pubs/pas/pa092.html>.

"World Bank and GEF Grants to Protect 13.5 Million Hectares in the Amazon."- Climate Change Policy & Practice. N.p., n.d. Web. 29 Sept. 2013. <http://climate-l.iisd.org/news/world-bank-and-gef-grants-to-protect-13-5-million-hectares-in-the-amazon/>.

"A Call for Change." N.p., 10 Mar. 2010. Web. 29 Sept. 2013. <http://www.foreign.senate.gov/imo/media/doc/55285.pdf>.