The World Bank Evolution Must Prioritize Forced Displacement

The World Bank celebrated its 2023 Annual Spring Meetings this month that focused on “Reshaping Development for a New Era,” where executive directors discussed the future direction of the institution. The global recession, high levels of inflation, the pandemic, the war in Ukraine, and climate change have negatively impacted development outcomes globally, forcing the World Bank to reform in order to respond to these changing dynamics.

During last year’s Spring Meetings, the World Bank’s executive directors requested the creation of a roadmap to address these rising global challenges. The result was the World Bank’s evolution roadmap, which proposes a new World Bank reform that places climate change, migration, pandemic preparedness, and fragility at the forefront of the development agenda. As the evolution roadmap and the new key global challenges were the focus of this year’s Spring Meetings, there remained a missing piece to the puzzle: forced displacement.

Forced displacement is one of the major challenges of our time—rapidly accelerating at an unprecedented the rate and scale. In 2021, forced displacement increased by 8 percent, doubling the rate of displacement from ten years ago. Indeed, 103 million people were forcibly displaced by mid-2022, and that has yet to fully account for the more than 8 million Ukrainian refugees who have fled the war-torn country. The situation is likely to worsen as the adverse impacts of climate change force more and more people away from their homes. By the World Bank’s own prediction, up to 215 million could experience climate-related displacement by 2050. Despite this, the topic has been excluded from the discussions regarding the new direction of the institution. This is a mistake.

Typically, forced displacement is addressed as a humanitarian concern, but it is also a development challenge. This is because mobility—and its drivers and impacts—are closely linked to development assistance. That not only creates an imperative to act, but makes the World Bank uniquely placed to lead. While the Bank has already acknowledged the importance of addressing forced displacement and its effects on development outcomes, its engagement in forced displacement situations remains relatively ad-hoc—limited to a few initiatives within the institution with relatively less funding. More needs to be done.

The World Bank already has a proof of concept. The institution has already led important efforts to support refugee situations, particularly through the creation of two dedicated financing mechanisms: IDA’s Window for Host Communities and Refugees (WHR) and the Global Concessional Financing Facility (GCFF). The Bank also provides technical and financial support to host governments and aligns the refugee response to development outcomes and policy reforms. The impact has been significant: the institution was instrumental in promoting policy changes in countries like Kenya, where World Bank funding incentivized the implementation of a framework to promote self-reliance among refugees. Their role complements humanitarian efforts and has the potential to increase the overall sustainability of the refugee response.

Including forced displacement as one of the key priorities in the evolution of the World Bank would help to unlock more and better financial support for refugee hosting nations—including more resources, better lending terms, and larger levels of conditionality. This is particularly important as low and middle-income countries are struggling to maintain healthy debt levels, which affects their ability to borrow funds, especially when they aim to support forcibly displaced populations. Prioritizing forced displacement within the World Bank’s evolution would also help streamline the topic across all of the World Bank’s portfolios and investments at a larger scale, expanding coordination with other key an interrelated priorities included in the roadmap. Acknowledging the impact of forced displacement in achieving development objectives would also signal to governments the need to prioritize policies that generate a win-win situation for both refugees and their host communities.

As the World Bank continues to navigate some of the most complex issues of our time and selects its new president, it’s important that it gets its approach to forced displacement—including climate-related displacement—right. Failing to do so will not only be detrimental to the improvement of development outcomes globally, but also to the well-being of tens of millions of forcibly displaced people and their host communities around the world.

Cover Photo: Kristalina Georgieva (R), Managing Director of the International Monetary Fund (IMF), and Nadia Calviño (C), Chair of the International Monetary and Financial Committee (IMFC), hold a press conference during the annual Spring Meetings of the World Bank Group at the IMF Headquarters on April 14, 2023 in Washington, DC. Photo by Kevin Dietsch/Getty Images.