Cooperating Through Competition: EU Challenge and Support to the World Bank Focality in Multilateral Development Finance

Abstract

Building on previous research on the relations between the European Union (EU) and the World Bank, this paper contributes to the debate on the World Bank focality in the regime complex for multilateral development finance. Adopting a historical‐institutionalist perspective, the analysis focuses on the determinants and mechanisms of micro‐institutional changes that have occurred in the context of EU‐World Bank's interaction in non‐core lending, particularly in World Bank trust funds and EU blending facilities. Most of the existing literature has focused on the ascendancy of new regional development banks outside the Bretton Woods camp, qualifying it as mostly conflicting or mostly cooperative. In contrast, this paper contends that a challenge has arisen also from within the group of core Bretton Woods‐inspired institutions. In addition, it shows how the EU has both competed and cooperated with the World Bank in the area of fiduciary funding, across three broad phases, and in response to specific critical junctures and tipping points. The EU’s innovation and quest for leadership in blended finance has replicated the World Bank’s good practices on some counts, yet it has also challenged its focality in non‐core lending.

Implementing the Humanitarian‐development‐peace nexus in a post‐pandemic world: Multilateral cooperation and the challenge of inter‐organisational dialogue

“…In spite of major efforts in 25 pilot countries (OECD, 2022) by the UN, EU and WB, either separately or in cooperation, problems remain with respect to joint financing and implementation effectiveness on the ground (CSO Partnership for Development Effectiveness, 2021; Desrosiers, 2021; IASC, 2021). Research on the EU‐World Bank cooperation in development and good governance support has shown the gains and the limitations of double delegation between large multilaterals with imperfectly overlapping memberships, revealing patterns of both cooperation and competition inside the group of Bretton Woods and Bretton Woods‐inspired institutions (Baroncelli, 2021). While new divisions of labour have emerged, pointing to the benefits of relative ‘specialization’ within the regime complex for development financing, redundancy has at times enhanced the effectiveness of their actions (Baroncelli, 2019).…”

“… 3 3 IPE research on inter‐organisational performance and regime complexity has shed light on the interactions between large multilaterals in development policymaking (Baroncelli, 2019, 2021; Heldt & Schmidtke, 2019), and also appears to provide vantage points to analyse their cooperation within the Nexus framework. Due to scope and space constraints, this policy paper offers preliminary insights in that respect, leaving a dedicated analysis to future research endeavours. …”