World Bank Procurement

• Author: Alison Micheli
• Pages: 207-232

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Chapter 11

World Bank Procurement

Alison Micheli*

I. Executive Summary

Established in 1944 to facilitate post-war reconstruction and development, the World

Bank is a global development cooperative owned by the governments of its 188 member

countries.1 This intergovernmental organization is the world’s largest development bank, with an

overarching mission of poverty reduction anchored by the twin goals of ending extreme poverty

and promoting shared prosperity in a sustainable manner by 2030. The World Bank Group

consists of five organizations: the International Bank for Reconstruction and Development

(IBRD), the International Development Association (IDA), the International Finance

Corporation (IFC), the Multilateral Investment Guarantee Agency (MIGA), and the International

Centre for Settlement of Investment Disputes (ICSID). Together, IBRD and IDA make up the

World Bank. In FY 2017, the World Bank provided lending commitments approximating $22.6

billion to IBRD member countries and $19.5 billion to IDA in support of investment projects

intended to pursue each organization’s respective goals.

This chapter summarizes the procurement rules and procedures that apply to World

Bank-financed investment projects. The World Bank procurement regime applies internationally

recognized procurement rules and promotes the use of standardized bidding documents and

contract forms in order to level the playing field and facilitate participation of international

contractors. Nevertheless, contractors should recognize that the World Bank is first and foremost

a development institution, and World Bank-financed procurements remain the ultimate

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responsibility of individual World Bank member country borrowers (Borrowers). For this reason,

World Bank procurements continue to be subject to the practical realities of each procuring

entity’s unique systems and requirements. Interested contractors should actively identify

potential opportunities through the World Bank but are well advised to carefully review and

become familiar with the World Bank procurement policies and procedures as well as the

applicable local requirements and realities in the Borrower’s country.

II. Substantive Rules Governing World Bank Procurement

The World Bank’s procurement rules emanate from its Articles of Agreement. These

Articles require that the World Bank “make arrangements to ensure that the proceeds of an y loan

are used only for the purposes for which the loan was granted with due attention to

considerations of economy, efficiency and competitive international trade and without regard to

political or other non-economic influences or considerations.”2 The Articles further provide that

the Borrower may withdraw loan proceeds “only to meet expenditures made in connection with

the operation as they are actuall y incurred.”3

The World Bank’s rules were originally devised for large-scale, standalone infrastructure

projects. They have gradually evolved since the World Bank’s founding, taking into account

changes in the World Bank’s operations and development priorities and conditions in member

countries. Recently, however, the World Bank’s procurement framework underwent an extensive

and far-reaching reform, culminating in a new procurement framework that became effective

July 1, 2016. Accordingly, this chapter will discuss World Bank procurement in the context of

dual procurement regimes, one long-standing and well established and the other largely untested

in practice but informed by the World Bank’s many years of experience.