From the outset, supporters of the IFC concept believed that the organization should have a “firm but distant” affiliation with the World Bank, according to historian Jonas Haralz. “[IFC operations] needed to mitigate the fears of private sector investors of unfair treatment by governments and to alleviate their apprehension about associating themselves with public funds. This complexity was perhaps the most important consideration for establishing the IFC as a separate corporation rather than as a department of the Bank.”
According to Haralz, there were other significant reasons, however, such as the reluctance to open up the Bank’s Articles of Agreement for revision, and the different nature of procedures and staffing required for operations with the private as opposed to the public sector. Financial separation was strongly emphasized, not least in order to prevent the higher risk of the IFC operations from affecting the creditworthiness of the Bank.
If you have an idea for a “postcard from the past,” please email Celeste Diaz Ferraro at cdiazferraro@ifc.org.
