Europe and Central Asia Regional Vice Presidency

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Europe and Central Asia Regional Vice Presidency

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History

The operations function of the World Bank has, in one form or another, been organized by geographic region throughout the Bank's history. The units responsible for World Bank lending and technical assistance have changed frequently in name and status since the Bank began operations in 1946. The history of the Europe and Central Asia Region (ECA) is complex primarily because of its previous integration with the Middle East and North Africa Region (MNA). Between 1965 and 1991, the countries within these two regions formed a single regional department/vice presidency called the Europe, Middle East, and North Africa Region (EMN or EMENA). Since 1991, the area covered by ECA countries has remained constant. As of 2016, ECA countries included: Albania, Armenia, Azerbaijan, Belarus, Bosnia and Herzegovina, Bulgaria, Croatia, Cyprus, Czech Republic, Estonia, Georgia, Hungary, Kazakhstan, Kosovo, Kyrgyz Republic, Latvia, Lithuania, Macedonia, Moldova, Montenegro, Poland, Romania, Russia, Serbia, Slovak Republic, Slovenia, Tajikistan, Turkey, Turkmenistan, Ukraine, and Uzbekistan.

1946 - 1952

Upon the Bank's opening in 1946, operational lending was executed out of the Loan Department (LOD) led by Charles C. Pineo. The LOD was responsible for developing loan operations policy, receiving and investigating loan inquiries, presenting loan inquiries to Bank management for consideration, and negotiating loans. The organizational structure of LOD fluctuated over its seven year history but was, for the majority of the time, organized geographically. The Bank's focus in these early years was on post-World War II reconstruction and, in particular, European countries. This is evident in the initial divisional organization of the LOD. Of the seven original divisions, four dealt with Europe and two with the Western Hemisphere.

This strong focus on Europe in the early years of the Bank is evident. The Bank's first Resident Mission was established in Paris, France in 1947 and a number of the Bank's first visits by its senior staff, including Research Director Leonard Rist, Treasurer Crena de Iongh, and Vice President Robert Garner, were to Europe. Almost all of the Bank's first loan applications were received from European countries: Czechoslovakia, Denmark, France, Luxembourg, and Poland (the lone exception being Chile). This resulted in the signing of the World Bank's first loan: on May 9, 1947 World Bank Executive Directors approved a loan for $250 million to Credit National of France (P037383) for reconstruction of its economic, finance, and trade sectors. Three loans to European countries followed before a non-European country, Chile, received Bank funding.

With the appointment of W. A. Iliff as Director of the Loan Department in 1948, LOD's seven divisions were briefly consolidated into two: the European and United Kingdom Division and the Latin American, Asiatic and African Division. Then, in November of 1948, divisions were briefly abolished altogether, as loans were assigned to loan officers on an ad hoc basis. In 1950, LOD was again divided into three geographical areas: Latin America Division; Asia and the Middle East Division; and European Division.

Parallel to the LOD was the Economic Department (ECD), which conducted sector analysis and research work. Between 1946 and 1952, the ECD was responsible for both functional and geographic analyses, i.e. general economic studies and country specific studies. ECD supported the LOD and its loan administration and advised member countries on their economic and sector development plans. The ECD also liaised with international organizations on economic research. It also provided staff for Bank missions to countries from the Bank's Washington, DC headquarters to conduct both economic and project-focused research. Like the LOD, the organization of the ECD reflected the Bank's focus on post-war Europe. The Department initially consisted of three area divisions and an Economic Technology Division responsible for specialized sector studies. In August 1948 a new organizational structure featuring two area divisions was installed. Area Division I was responsible for Europe and Area Division II was divided into four sections that dealt with: Central America; South America; Asia; and Africa and the Middle East. In March 1950 another reorganization divided the Department into an advisory staff and an area staff, the latter consisting of three divisions of which Europe and Africa was one.

1952 - 1972

When the World Bank opened, its primary focus had been the reconstruction and revitalization of European countries devastated by World War II. However, as other sources of investment became available to war torn European countries, the Bank quickly shifted its focus to non-European countries. Largely due to the resulting expansion in operations in Latin America, Africa, and Asia, a Bank-wide reorganization took effect in September of 1952. The new operational structure endured for the next twenty years. The major feature of the reorganization was the merging of LOD staff with country-related staff from the ECD to form three distinct geographical Area Departments: Europe, Africa and Australasia (EAA); Asia and Middle East (AME); and Western Hemisphere (WHM). These units were primarily responsible for World Bank-member country relations. Functions included: loan policy and plan development; country development program appraisal and review; preparation of proposed loans; and country economic monitoring.

There was no formal divisional structure within EAA. Note that, in 1952 when the Department was initially formed, only two EAA countries were not located in Europe: Australia and South Africa. The Department was led by A. S. G. Hoar between 1952 and 1955. Sydney Raymond Cope became Department Director in June of 1955. All three Area Departments reported to Vice President Robert Garner from 1952 to 1956. After Garner became President of the new International Finance Corporation (IFC) in 1956, the Area Departments reported to J. Burke Knapp and William Iliff.

As part of the 1952 reorganization, the sector-oriented staff of the former ECD moved to the Technical Operations Department (TOD) in the new Area Departments and was placed in charge of project appraisal and supervision. Specifically, the TOD was responsible for: the appraisal of proposed projects; advising Area Departments on proposed projects and assisting in negotiations; supervising approved projects; assisting borrowers in procurement efforts; and monitoring and reporting on member countries' sector economies.

By 1962, a division of the Europe, Africa and Australasia Area Department (EAA) was necessary as a result of the dramatic increase in membership by African countries. Two new departments were created out of the former EAA: the Department of Operations - Europe (EUP); and the Department of Operations - Africa (AFR). EUP functional responsibilities were the same as its predecessor and it did not have a formal divisional structure. Sydney Cope became the Director of the new EUP and oversaw lending operations with 20 European countries, Australia, New Zealand, and South Africa.

In 1965 the World Bank implemented a major reorganization of country groupings in its regional departments and EUP was significantly impacted. The countries previously in EUP were combined with Middle Eastern countries formerly located in the Department of Operations - Europe and Middle East Department (EME). In addition, five northern African countries (Egypt, Libya, Algeria, Tunisia, and Morocco) were also included In EME. Functional responsibilities of the new department remained unchanged from predecessor departments. Sydney Cope served as Director of EME.

The new combination of European and Middle Eastern countries was briefly undone in 1967 when EME was divided into two separate departments: Europe Department (EUR); and Middle East and North Africa Department (MNA). European, Middle Eastern, and North African countries were again reunited during a significant reorganization in 1968, forming the new Europe, Middle East and North Africa Department (EMN). Thus began an uninterrupted period of 23 years during which Middle Eastern and North African countries would be combined with European countries in a single department or Vice Presidency. The new EMN was led by Michael L. Lejeune; he was replaced by Munir P. Benjenk in 1970. The Department was initially divided into five divisions roughly based on geography. European countries roughly made up two divisions while Middle Eastern and North African countries formed the other three.

1972 - 1987

A massive, Bank-wide reorganization was initiated by World Bank President Robert S. McNamara in 1972. As part of the reorganization, the geographic organization of the regional units was again altered. The seven departments that made up the Area Departments were elevated to five Regional Vice Presidencies (RVP). However, the composition of EMN was not altered. All RVPs reported to the new Senior Vice President, Operations (SVPOP).

A more significant aspect of the reorganization, however, was the integration of the former Technical Operations Department (renamed the Projects Division [PRJ] in 1965) with the new RVPs. The period between 1952 and 1972 had been characterized by frequent reorganizations of the geographically-based area units responsible for country liaison and loan policy and negotiation. However, the division of functional responsibility between these units and TOD/PRJ was maintained. But in 1972, in an attempt to more effectively fuse country knowledge and sectoral skills, most of the Bank's operational project work was moved from the Projects Department to the five new Regional Vice Presidencies. Staff from the former PRJ were distributed into the Regional Vice Presidencies and were organized into sector-oriented Project Departments and were known as Central Projects Staff. Thus, rather than one Projects Department that supported projects in countries on an ad hoc basis, each RVP would maintain its own projects staff. Each RVP was, in turn,given "line authority" to analyze, decide and act on country development operations. Each RVP was responsible for planning and executing IBRD/IDA development assistance programs subject to the overall framework of Bank policies, priorities, and operating procedures. The RVPs created regional plans and budgets, ensured the effective implementation of approved plans, created country economic and sector reports, and developed and implemented loan, credit, technical assistance, and other forms of development projects. The RVPs were also responsible for maintaining sound relations with governments of assigned countries and with aid organizations and donors involved in those countries.

Upon the completion of the 1972 reorganization, EMN consisted of two Country Program Departments in addition to the new Projects Department. The Country Program Departments were staffed by country economists and loan officers whose primary responsibilities were: conducting area reviews of Bank activities and countries' economic and political developments; formulating country lending and economic and sector work programs and implementing country programs; and reviewing loan applications, negotiating loans, and administering loans.

The Projects Department provided technical assistance and advice to members and borrowers on sectoral issues, country priorities, and project development from identification through implementation and review. It consisted of economists, financial analysts, and sector specialists, and was specifically responsible for: creating sector policies; assisting countries with the identification and preparation of projects; appraising potential projects; assisting the Country Program Departments in loan negotiation and credit agreements; and helping borrowers manage consultants and procurement.

EMN's Project Department was initially divided into five sector-based divisions: Agriculture; Education; Public Utilities; Transportation; and Development Finance Companies. Over the next fifteen years, new divisions were created for sectors such as energy, water, telecommunications, industry, finance, and urban.

Note that not all staff and operational responsibility was transferred from the former PRJ to the RVPs. Staff in sectors too small to decentralize to the five regions continued to provide a complete "operational package" of technical services to the regions. These units, such as the Population and Nutrition sector and Urban Projects sector, were known as Central Operating Projects Departments and were located in thenewly formed Vice President, Central Projects (CPSVP) which, like the RVPs, reported to the SVPOP. In addition, those former PRJ units which had their operational functions dispersed to the RVPs still maintained a core staff in the CPSVP with responsibility for policy and advisory work only.

When EMN became a Vice Presidency in 1972, it contained the following countries: Afghanistan, Egypt, Iraq, Saudi Arabia, Iran, Denmark, Finland, Iceland, Italy, Norway, United Kingdom and African Dependencies, Yugoslavia, Austria, Bahrain, Belgium France, Ireland, Jordan, Luxembourg, Netherlands, Portugal, Qatar, South Africa, Spain, United Arab Emirates, People's Democratic Republic of Yemen, Turkey, Algeria, Libya, Morocco, Greece, Israel, Tunisia, Cyprus, Lebanon, Malta, Oman, Syria, and Yemen Arab Republic. EMN's first Vice President was Munir P. Benjenk. Benjenk served in this position from 1972 through 1980 with the exception of a ten month period between 1975 and 1976 when Willi A. Wapenhans took over. Roger Chaufournier was named EMN Vice President in 1980 and Wapenhans once again assumed the position in 1984.

1987 - 1991

While the composition of the Country Program Departments and Projects Department changed between 1972 and 1987 (most notably with a considerable increase in the number of Projects Department sector divisions), the organization and functions of the RVPs was consistent until 1987. In July of 1987, however, a Bank-wide reorganization under President Barber Conable altered the structure of the RVPsconsiderably. The changes were brought on by a desire to strengthen the Bank's country focus by making the Country Department the basic program and budget unit.

The new Country Departments that replaced the Country Program Departments combined the macro-economic work of the former Country Program Departments and the sector work of the former Regional Projects Department. Each Country Department would consist of a Country Operations Division (COD) as well as multiple Sectoral Operations Divisions (SOD) made up of staff from the former Regional Projects Departments. The COD was composed of lead, country, and specialized economists as well as country officers and was responsible for: liaising with state governments and developing knowledge of issues in the country; preparing and supervising the country's aid strategy; and providing full responsibility for certain country-wide operations such as Structural Adjustment Loans and country economic work. SODs were responsible for overall sectoral strategy and for planning, programming and implementing development activities for the countries in their respective sectoral specialties; this would include the provision of full lending project management as well as lending and sector evaluation work.

Not all staff was moved from each Region's Project Department into the Country Departments' SODs. Those remaining formed a new Regional Technical Department within each RVP. It was responsible for higher level knowledge collection, assessment, and dissemination. The Technical Department, which was organized into sector-focused divisions, was to stimulate innovation in operational work and undertake strategic thinking by providing advice, operational support, regional studies, staff training and the dissemination of materials to Bank staff, donors, and other institutions outside the Bank. The Department would continue to offer operational help in the form of task management, task support, and advice. They would also work closely with Policy, Planning and Research (PPR) staff in conducting regional studies and reviews, and advising on sector policy and research priorities.

During the 1987 reorganization the number of RVPs decreased from six to four but EMN was not affected in this regard. The number of EMN Country Departments did, however, increase from two to four. The allocation of countries between departments during this period and the sector-oriented divisions comprising the country departments changed over time to reflect changing priorities in the region's operations. EMN was led by Vice President Wilfried P. Thalwitz from 1987 to 1989 and Willi A. Wapenhans from 1990 to 1991.

1991 - 1996

The fall of the Soviet Union and the end of the Cold War had significant implications for the World Bank and its organization. Beginning in July 1990, the World Bank, in cooperation with G7 countries and other international organizations, participated in a series of studies on the Soviet Union's economy. (See the Documents & Reports website for access to World Bank authored reports on the various aspects of the region's transition and the World Bank's involvement.) Only a month after the Soviet Union dissolved in December 1991, the government of the Russian Federation formally applied for membership in the World Bank. During 1992 the fifteen republics of the former Soviet Union also applied for membership. The World Bank subsequently engaged in one of the largest operations in its history as it established working relations with its new members, set up new resident missions and offices, and prepared and negotiated new projects.

A reorganization of the Bank's regional vice presidencies and a reallocation of countries was deemed necessary as a result of these developments. In 1991 the Europe, Middle East, and North Africa Regional Vice Presidency (EMN) was divided into two new RVPs: the Europe and Central Asia Vice Presidency (ECA) and the Middle East and North Africa Vice Presidency (MNA). (During this reorganization the Asia Regional Vice Presidency [ASI] was also divided into separate east and south Regional Vice Presidencies, increasing the number of RVPs from four to six). ECA maintained the same functions and internal organization as its predecessor unit. Note, however, that ECA and the new MNA continued to share a single Technical Department. Composed of various sector-oriented divisions, the Technical Department maintained responsibility for sector knowledge dissemination, research and development, and operational review and advice.

A subsequent reorganization in 1993 strengthened the Country Departments' SODs through unit reorganization and a transfer of staff from the Regional Technical Departments to the SODs. The Technical Departments were greatly reduced in size and were restructured to reflect the emphasis on sectoral and thematic responsibilities of the SODs. The Technical Departments operational support function was consequently reduced.

Wilfred Thalwitz was named Vice President of the new ECA in 1991 and would hold the position through the end of 1995.

1996 - 2014

Another reorganization in 1996-97 modified the changes made to the RVPs in 1987 and 1993. The RVP continued to be responsible for all aspects of country development assistance for its member countries, including: country assistance strategy; lending operations; technical assistance operations; and economic and sector work. The primary objective of the reorganization was to deepen the country focus and responsiveness to client needs. This was accomplished in a number of ways. The most striking changes concerned the new Country Management Units (CMUs) which replaced the former Country Departments. The CMUs were smaller than their predecessor (that is, each was responsible for a smaller number of countries) while their number correspondingly increased. The internal reorganization of ECA resulted in an increase from four Country Departments in November 1996 to eleven CMUs in January 1998.

In addition, an increased decentralization of CMU staff and country directors from Bank headquarters in Washington to locations within client countries was undertaken. At the same time, a strengthening of authority with regard to strategy and budget was given to the country directors. The CMUs continued to be responsible for overall preparation and supervision of the country's assistance strategy, full lending project management, and evaluation of lending and sector work.

During the reorganization, the former Technical Departments were changed into Sector or Technical Families. The role of the Technical Families, which consisted of sector and project economists and selected specialist staff, was to formulate knowledge on technical subjects and best practice, and to suggest innovation through research and development. From this point on, ECA ceased sharing its technical units with MNA.

Johannes Linn was named Vice President of ECA in 1996 and served in this position until 2003 at which time Shigeo Katsu took over the position. Philippe Le Houerou replaced Katsu in 2009 and he, in turn, was replaced by Laura Tuck in the fall of 2013.

2014 - Present

In order to stimulate the sharing of knowledge and best practices across the Bank, President Jim Kim introduced a Bank-wide reorganization in 2014 that removed sector staff from the Regional Vice Presidencies and placed them in one of fourteen Global Practices (GPs) or five Cross-Cutting Solution Areas (CCSAs). The GPs are responsible for each of the major thematic areas that the Bank supports through projects, such as agriculture, water, and education. Each GP functions as a vertical pillar of technical expertise and is responsible for: defining the strategic direction and the World Bank's activity in their respective sector; developing and deploying expertise globally; delivering integrated solutions to client countries; and capturing and leveraging knowledge in their respective fields. The CCSAs, on the other hand, serve as units that cut across GPs horizontally providing leadership in areas such as climate change, gender, and public-private partnerships, and focusing on Bank-wide strategic goals and directions.

After the 2014 reorganization, the Regional Vice Presidencies exclusive function became overall client engagement. Specifically, each RVP: sets and drives regional strategic direction; offers development solutions to clients; agrees on work program and budget with GPs; recruits expert GP staff to meet client needs; manages corporate and other stakeholder relationships; and oversees country programs. Each RVP retained multiple Country Management Unit (CMUs) responsible for one or more countries. The CMU is the primary interface with the country and is responsible for ensuring global solutions are applied to the local context. Specifically, the CMU: identifies client challenges and opportunities; sets country strategy and manages selectivity; develops work programs and provides solutions; manages client and stakeholder relationships; and manages the country office.

Cyril Muller replaced Laura Tuck as ECA Vice President on July 1, 2015.

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