The World Bank has stressed the need to combine public finance, private investment, philanthropy and technology in assessing what each country needs as nations address scarce resources and job creation challenges.
Ajay Banga, president of the World Bank Group, said the institution's hurdles involve stretching limited resources further and generating enough jobs for a growing workforce.
"Where needs and risks are greatest, public and concessional finance will remain essential," he told the IMF-World Bank Annual Meetings on Friday, adding that funding partnerships must evolve as countries develop.
Public funding should target areas where markets cannot yet reach, while private capital should support business expansion and job creation. Philanthropy can absorb early-stage risks and encourage innovation, while technology can improve the impact of every dollar invested, said Mr Banga.
"The World Bank aims to bring these resources together and tailor them to each country's development needs. That is the future of development we are working towards," he noted.
The group mobilised a record US$112 billion in private capital in fiscal 2026, more than tripling the amount raised four years earlier as it steps up efforts to create jobs and channel investment into developing economies.
Six multilateral development banks are developing common approaches to assess, package and transfer investments, allowing institutional investors such as pension funds, insurers and sovereign wealth funds to participate in development projects.
The initiative aims to free up development banks' balance sheets for new projects while creating a broader market for development-related assets.
BANK STRATEGY
Mr Banga said the bank's strategy focuses on three pillars: physical and human infrastructure, regulatory and policy certainty, and measures to help businesses expand.
Infrastructure investment includes electricity, water, transport and digital connectivity, alongside healthcare, education and skills development. Last year the group committed $40 billion, nearly one-third of its financing, to these foundations.
Meanwhile, 30% of its public sector financing supported policy and institutional reforms, including efforts to improve governance, simplify permits and establish clearer business regulations.
To attract investment at scale, the World Bank is expanding the use of guarantees, equity financing and local-currency funding to reduce risks that discourage private investors.
The approach has begun to deliver results. Private capital mobilised by the group rose from about $35 billion in fiscal 2022 to $112 billion in fiscal 2026. Combined with its own financing, total financing exceeded $230 billion.
The next phase requires scaling up successful initiatives and mobilising more capital from a wider range of investors, noted Mr Banga.
"If we get this right, the size of our balance sheet no longer defines the scale of our ambition and we will bend the curve of development forever," he said.
JOB CHALLENGE
Mr Banga said creating jobs at scale is one of the most urgent development challenges, particularly as developing economies grapple with rising debt burdens, limited fiscal resources and persistent conflicts.
The world faces a potential shortfall of 800 million jobs over 10-15 years as 1.2 billion young people enter the labour market, but only about 400 million jobs are projected to be created.
The World Bank has called for a major expansion of private investment, infrastructure development and technology-driven employment. The projected gap between the number of young people entering the workforce and available jobs highlights the need for a development model that can attract private capital, strengthen businesses and improve productivity, he said.
"A job is not a statistic. A job is dignity," Mr Banga said, describing employment as the difference between young people being able to build their futures and having to wait for opportunities.
The lender identified five sectors with strong potential to generate employment: infrastructure and energy, agribusiness, healthcare, tourism and value-added manufacturing.
The group is seeking to direct more investment towards sectors with strong potential to raise productivity and create jobs. Nearly 55% of its financing and mobilised private capital went to infrastructure and energy, agribusiness, healthcare, tourism and value-added manufacturing.
Technology, particularly practical artificial intelligence, is a potential driver of employment and productivity, he noted.