- November 6, 2013
- Posted by:
- Category:BLOG, Chennai, Events, Speaker Events
Contributed by: Meera Siva
IAIP organised a Speaker Event titled “Private Investments to Fund Global Development” in Chennai on October 26th 2013, wherein Anitta Jaison, a Senior Financial Officer at The World Bank (WB) and head of its Structured Products unit in Chennai, provided very good insights on WB’s goals, how it funds various initiatives, public private partnerships etc. The event was well received by the members.
Anitta first made a case for poverty eradication by providing data on what is defined as poverty (below $1.25 per day). Around 1.3 billion people in poverty, which is around 18 per cent of the world population. There is also a high risk category of those who live just above the poverty line.
The World Bank has set a goal to bring poverty down to under 3 per cent by 2030 and to achieve that, besides government funding, private sources are also needed.
She described how the WB funds development initiatives by raising funds at low cost and offering loans. The government of the country where the project happens guarantee payment, but WB takes the payment for sovereign default. She said that if a country defaults on WB payment, who is a privileged lender, all other funding flows stop and hence countries rarely are motivated to stop payment.
The WB has 189 countries as shareholders. Typically the bank takes up large projects where a lot of funding is needed; the time horizons are also long and payoffs are uncertain. There is usually a social pay-off in addition to an economic benefit.
As the private parties in a Public Private Partnership (PPP) for a project may be more focused on economic benefit, good regulatory framework for oversight is needed for success. She indicated that there is a risk of corruption by individuals. PPP must not lead to creating monopolies that may cause predatory pricing.
She described a PPP initiative for polio vaccination called GAVI. She elaborated how governments, pharmaceutical companies, NGOs such as Gates Foundation are working together to immunize an additional quarter billion children, to save about 4 million lives, through a focused concerted effort. WHO is working on providing supplies, WB and donors are financing the recipient countries and UNICEF is managing procurement.
– M S
PS: The presentation could be accessed at http://www.cfasociety.org/india/Pages/ContinuingEducation-Presentations.aspx