[MUSIC] Stanford University.>>I’m really honored to be here for the Inaugural Conference on
Global Development and Poverty. And it’s really great to see students,
faculty, and professionals from so many disciplines coming together to think
about shared prosperity and health. I’ve been both an infectious
disease physician, working in some of the poorest places in
the world, and a university president. And if you asked me which
was more difficult, treating multi-drug resistant tuberculosis
in the slums of Lima Peru, or getting faculties to work together
across disciplines and big problems.>>[LAUGH]
>>Very very close call. [LAUGH]
>>[LAUGH]>>But that’s precisely your mission here at the Global Development and Poverty Initiative, seeking
transformative solutions to challenges and development and poverty that
are necessarily cross disciplinary.>>Is exactly what a great
university should be doing. This collaborative approach to solving the
world’s toughest challenges is something that we’ve worked to institutionalize
at the World Bank Group. Because without collaboration that is
both broad and deep, we have really little hope of accomplishing our twin
goals, which Dean Saloner mentioned, to end extreme poverty by 2030 and
boost shared prosperity. To accomplish the first, we have to reduce the proportion of people
living under $1.90 a day to less than 3%. We looked at this carefully. Because of natural disasters and other unforeseen disasters,
it’s hard to get below 3%. To accomplish the second, we have to grow
the income to the bottom 40% at least as fast, but preferably faster, than the rate
of growth of the economy as a whole. These goals were endorsed by
all 188 member governments of the World Bank group in April of 2013,
just about 8 months after I started. And I was both delighted and a little bit
surprised that there was such unanimity around the goals, because they’re the most
ambitious in the history of the bank. Over my career, I’ve learned,
and it’s something that I think is very well taught in business schools,
that setting time bound targets is one of the most important steps if you
want to achieve ambitious goals. It’s true in the field of health, but it’s even more true when it comes
to the health of poor people. When I was working at
the World Health Organization in HIV, we set this target of treating 3
million people in developing countries, with HIV/AIDS treatment and
ATI antivirals by the end of 2005. And that was just two and a half years
after we established the target. Now, when we set the target,
there were probably anywhere from 50 to 75,000 people in all of
Sub-Saharan Africa in treatment. But probably 10 million,
at that time probably at least 2 or 3 million, by the definitions of that age,
needed treatment. So, this campaign of getting 3
million on treatment by 2005, may not sound like much, and it certainly probably doesn’t sound
like much to the undergraduate students. But back then, just about the entire global public health
community told us that we were crazy. Critics told us that it couldn’t be done. There wasn’t enough money,
there wasn’t enough infrastructure. Some even suggested that
treatment was too complex for African people,
because Africans did not have watches and would not be able to comply with
very complicated medical regimens. But with extraordinary commitments, I
mean, President Bush made one of, I think, the most extraordinary commitments that
I’ve ever witnessed a president making when he established the President’s
Emergency Plan for AIDS Relief. And also, we had the Global Fund
to Fight AIDS, TB and Malaria. These huge new efforts, plus the three by five target,
brought together a diverse set of actors. And we stopped spending
all our time arguing about whether treatment was possible and
focused on scaling up. And unless you have a target and somebody
is counting, which is what we did at the World Health Organization, it’s very
hard to get people to stop fooling around, and having, frankly, at that time what
I thought were unhelpful arguments. So, by measuring success according to
the number of people being treated, three by five campaign also encouraged
accountability among both donors and recipients. When we announced the target,
both the donors and the recipients were very angry at us. The donors are saying how could
you set such an ambitious target when we haven’t told you were
going to give you the money? And African country ministers of health
were furious because they were saying, you’re setting this incredibly ambitious
target without telling us how we’re going to get there. But by the end of 2005, the number of people receiving HIV
treatment had increased eight-fold. And we didn’t reach the target, but
we did reach the target in 2007. So two years late is about the best that
the United Nations system has ever done in reaching a target. But today, almost 11 million people in the region now have access
to ATI antiviral therapy. And the global goal for
2015 is 15 million people, five times higher than what we aimed for
just 10 years ago. And it’s hard to imagine for me what Africa would look like if we
hadn’t fought so hard for AIDS treatment. But you have to remember, and there’s
a lot of revisionist history going on, but the vast majority of the global
health community was saying treatment is impossible for the 25 million
people in Africa living with HIV. We’re afraid. We’re talking about the next generation. So, all 25 million people, we looked them
in the eye, global health leaders, and told them, I’m sorry, but
you’re all dead because it’s inconvenient. And so, if you look back at
economic growth in Africa, it’s been growing at over 5% even through
the economic crisis that started in 2008. I cannot imagine that we would have seen
that kind of growth if nobody knew their status and 10 million people had died
in countries all over the continent. So as with all ambitious targets,
the global health community, when we set the target, had to fundamentally
rethink what it was doing and focus on the things that would
make the biggest difference. So access to drugs was a huge challenge
because most of the developing countries did not have procurement in supply chain
systems that were prepared to deal with just a simple volume of medicines that
were going to pass through their systems. New strategies and
alliances were required. Drug regimens, diagnostics,
had to be adapted to local conditions. New infrastructure had to be built, and a whole new cadre of health
workers had to be trained. But that’s the beauty of a time bound,
ambitious target. It forces you to change. I remember visiting a local
health official in South Africa right before we started a 3 by 5
Initiative who probably told me that his team had met all its targets for
the last five years. I very humbly suggested that well, maybe
your aspirations just aren’t high enough if you’re meeting every single target. Paul Batalden is one of my heroes. He’s a great medical doctor. He’s one of the gurus in
quality improvement and health. And he said, and
this rings through my mind every day, every system is perfectly designed
to get the results it’s getting. So if you want to do right by the poor, if you want to develop health
systems that can do things for poor people’s health that never have
been done before, you’ve got to change. And if you want to change a system, setting an ambitious target
is a great way to do it. So, we find ourselves in a similar
situation today with the target of any extreme poverty. We have the targets in place but what
are we going to have to do differently? To actually achieve something that
has never been possible before. We have never been able to see
the end of extreme poverty. This is the first
generation in human history that has been able to see
that potential outcome. The good news is that we’ve
made a lot of progress. In 1990, when the world population
was around 5.2 billion people, 36% of the global population lived
in extreme poverty, and back then the definition of extreme poverty was
a dollar a day, less than a dollar a day. In 2012 with 7.3 billion people,
so population has increased. 12% lived in extreme poverty. In the last 15 years, we’ve gone from
nearly 2 billion people living in extreme poverty to less than a billion. This year, for the first time in history,
we expect that the extreme poverty rate globally will drop below 10%,
or a 9.6%, 700 million people. This is the best news
story in the world today. But we’re deeply humbled by
the challenge ahead of us. By 2020, half of all the extreme
poor will live in fragile and conflict affected settings. The prospects for
economic growth in developing economies is the lowest today as it has
been over the past decade. Rising global temperatures will have
devastating impacts on poor countries and poor people, and as we saw with Ebola, major pandemics are likely to
disproportionately affect the poor. Inside the World Bank Group for the past
50 years, we’ve continued to distill and analyze our global experience in fighting
poverty and boosting shared prosperity. And as a result, our advice to
governments has evolved over time. We’ve taken a new look at the drivers
of progress over the last 15 years and know that our approach also
has to continue to evolve. Our strategy to end extreme poverty and
boost shared prosperity, based on the best global knowledge available,
can be summed up in just three words. Grow, invest, insure. So decades of experience have taught
us that economic growth it the primary driver of increased personal income and
poverty reduction. Sustained growth requires macroeconomic
stability in the form of low inflation, manageable debt levels. And reliable exchange rates. Government policies and
investments, though, have to prioritize growth in the sectors
that will increase incomes of the poor. Not all investments and not all growth strategies will
have that impact on the poor. The global economy, as I mentioned,
is now facing significant headwinds, especially for the emerging markets. Growth is slower than it’s been for
some time, and the commodity super cycle, which has driven so much of
developing-economy economic growth, ended three or four years ago. And the depressed commodity prices,
we think will continue for some time. There’s also an exodus of capital from
developing countries that’s likely to accelerate as the Federal Reserve
increases its funds rate target. Nobody knows exactly when,
but it will happen soon. Now promoting growth has always been
a priority for the World Bank Group, at times it has seemed that
it was our only priority. Other development goals,
including investing in health and the environment were just not on the front
burner for the World Bank Group, and that’s why 20 years ago, I was part of
a movement called 50 Years is Enough. It was a movement that was focused on
shutting down the World Bank Group, on its 50th anniversary in 1994.>>[LAUGH]
>>Now, I’m very glad that we lost that argument because
>>[LAUGH]>>I get to come here and talk to you guys, but the great thing
about the World Bank is that we’ve learned from the evidence, we change, and
we’re now taking a much broader approach to development because we know that growth
in GDP alone is not enough for us to achieve the twin goals of ending extreme
poverty and boosting shared prosperity. We have been a producer of some of that
evidence that has forced us to change but we’re also in institution that
is ready to make changes and operations and policy based on evidence. And I’m sure the people in this audience
know the evidence is increasingly clear than in addition to growing their
economies Developing countries have to make investments in their people,
especially in health and education. They also have to support programs and
policies that insure people against risks that threaten to plunge
them into poverty because of events and circumstances beyond their control,
the so-called social protection programs. Now among the investments that developing
countries can make in the health and education of the people, the most important ones start
when a woman becomes pregnant. It’s the combination of heath, nutrition,
and education of investment and insurance known as early
childhood development. 26% of all children under five in
developing countries are stunted. And this is a condition in which
children are not only malnourished and under stimulated but
risk a loss of cognitive abilities, literally have fewer neuronal connections. Now in Sub-Saharan Africa, unfortunately, 36% of all children
under five are stunted. Just to get your head around it,
that’s nearly four in ten of Sub-Saharan Africa’s children with
frankly limited prospects in life. In my mind this is an absolute disgrace. It’s a global scandal. In my view really something
akin to a medical emergency. Children who are stunted by age five, will
not have an equal opportunity in life. It’s difficult to imagine a path
to the end of poverty, or shared prosperity without proper
antenatal care for mothers. Appropriate stimulation, nurturing, and
nutrition for infants, and young children. Because if your brain wont let you
learn and adapt in fast changing world you won’t prosper and
neither with society all of us loose. The World Bank Group is committed to
effective action on early childhood development, we’ve identified
five packages of 25 services for children based on strong evidence.>From 2001 to 2013, we invested
$3.3 billion in early childhood development programs around the world,
Haiti, Indonesia, Jamaica, Lesotho,
Mozambique, Russia, Vietnam. In one example,
using innovative policy making and development finance tools,
one I’ll talk about a little bit later. Giving money only when the results are in. We helped Peru cut its rate of
childhood stunting in half, from 28 to 14% in just eight years. We know that progress is possible and
progress is possible quickly, but we have to do so much more. What we need now is
an ambitious global goal that will help drive our work
in early childhood development. For childhood stunting,
the world did set a target in 2012, to reduce stunting in
children 40% by 2025. But that would still leave
100 million children stunted. This goal, in my view,
is just not ambitious enough. If equality of opportunity is indeed
a value that we all share and we’re serious about boosting shared
prosperity, we need to work together to set a target to end the stunting for
all children well before 2030. That kind of goal will enable us
to hold each other accountable, forcing us to change the way we work. We need to formulate a plan
to end stunting, and use innovative financing
mechanisms to pay for it. Now, ensuring that children have
the neuronal connections to learn is only half the battle. We’ve gotta also make sure that they’re
in school and actually learning. Today, 91% of children in developing
countries attend primary school, which is up from 83% in 2000. So over that 15-year period, attendance rates in
Sub-Saharan Africa have gone up 20%. That’s great. The number of out of school
children of primary school age has also fallen by almost half to 57
million from 100 million in 2000. But we cannot rest until every child is in
school and every child is also learning. The evidence on learning outcomes, unfortunately, among young people in
many countries is really very alarming. An estimated 50% of young people in Kenya who have completed six years of
education cannot read a simple sentence. International assessments
also show the average eighth grade student
in the Middle East and north Africa region, performs below the
international average in science and math. And in some cases, very far below. The low achievement levels that we’re
seeing throughout the developing world have devastating implications
when people look for jobs, and also, will have devastating implications
for future economic growth. I think that many of you of course
know of Sal Khan and his great work at the Khan Academy, and I think this
presents a very interesting model for boosting educational outcome
globally much more quickly, with $25 iPad type devices and
Khan Academy instruction. We can put into the classroom some of
the best instructors in the world, using technologies. You know, what we’ve found is that
teachers themselves learn how to teach important lessons by having the Khan
Academy materials in the classroom. And so we’re now working
in rural Guyana and India. And also with Mexico and
Middle Eastern countries. To try to bring Khan Academy translated into those programs because they’d
have to wait otherwise 20 to 30 years before the quality of teachers gets up to
where it is for example, in East Asia. The pilot programs we have underway are showing that technology can
potentially transform learning outcomes. In Lagos, Nigeria, for example, e-readers are being used to
help improve student performance. And data shows that the devices have
had a significant positive impact on student’s non-verbal skills,
and reading and math scores, especially among students
who do not own textbooks. So education is an area that we’ve got to
move, but health is the topic of the day. And the great news again in
health is that we have so much better evidence on the role
of improve of health outcomes in everything from ending poverty but
also economic growth. In 2013 The Lancet Commission
on investing in health, which is a team of global health
experts lead by Larry Summers, concluded that between 2000 and 2011,
better health outcomes accounted for fully 24% of increase in
what’s called full income, not just, it’s a complicated calculation,
it’s a great paper. The commission also determined that the
economic return on investment in health in low and middle income countries
could be as high as ten to one. Even here in Silicon Valley, ten to one
is a pretty good investment return. So with the right investments,
with the right program structure, we can reach what they have called
a grand convergence in health outcomes, meaning that a child in Cambodia and
a child in California could have the same chance to survive and
live a long and healthy life. This makes improving the quality
of health systems everywhere a critical development issue that’s
essential to boosting shared prosperity. So in the calls that we’ve made,
and many others have made, for universal health coverage,
we see the potential for a transformative program that can bring
us toward this grand convergence. The challenges are many. The depth and breadth of these challenges were never
more clear than during the Ebola crisis. We learned then that we’re completely
unprepared for an epidemic. The outbreak also showed that we have
failed over many years to build effective health systems in every country and that
of course means that the weakest health systems are the ones that are going to
accelerate any epidemic in the future. The deaths of more than 11,000 people and
billions of dollars of economic losses in Guinea, Liberia and
Sierra Leone have proven this to us. These are three of the poorest
countries in the world but prior to Ebola these were three of the
fastest growing economies in the world. Needless to say their economic growth has
been negative over the past few years. So we need a robust capacity to respond
to epidemics wherever they occur and we also need the stronger health
systems that can diagnose and treat the sick wherever they are. Stronger health systems can
extend the reach of nurses and doctors and
also not only they’ve been proven time and again to improve outcomes in so
many different areas. But we can also use them as the frontlines
of our epidemic outbreak alert and response network. Just imagine what would have happened if
in December 2013 in the small Guinean village where a two year old who
was the first index case of Ebola. Imagine if that village had
trained health personnel linked to a disease surveillance
system like there already is in the Democratic Republic of the Congo and
Uganda. Though epidemics, outbreaks in those
countries were quickly controlled, because those systems were in place. What first looked like cholera or a diarrhea would’ve been recognized as
potentially something far more serious and a quarantine would’ve been
established in DRC and Uganda. Instead, we didn’t figure out what was
going on until three months later, when a doctor who’d been
treating the sick had died. By then, the infection had
spread to three countries. Three months it took us to
even know what was going on. One of the most important interventions
during the fight against Ebola was behavioral change, and
this was absolutely critical. Local customs dictated that people
care for victims at home, and the custom also was to touch
the dead bodies before burial. And that’s precisely the point at which
the dead person is most infectious. The many western doctors and literally
billions of dollars that ultimately supported the containment effort would not
have worked unless, if we had not had, ultimately, people who spoke the local
language, who knew the local customs, and had enough cultural capital to be able to
convince people to change their behaviors. In the end, it was behavior
change that stopped the epidemic. Now we believe that trained community
health workers can be vital to improving outcomes in many areas of public health,
and also that they can form the backbone of a community based approach
to global pandemic response. Now, investments in
community health workers generate lots of other good
development dividends. They offer formal employment for
women and often unemployed youth. They can also become
pathways out of poverty and informality for low income and
low skilled workers. In India and Ethiopia the World Bank Group
is supporting programs that train frontline health responders and give them incentives to continue on career
paths in health care and other related.>>Social sectors such as, in those two
cases, early childhood development. Overall, our financing is expected to
support and train close to one million mostly female community health workers
in the areas that are needed the most. You know, there’s still so much that we need to do to build
effective global pandemic response. And just to give you a sense of it,
virologist infectious disease experts are almost
certain that something like an 1918 style flu pandemic is going to happen
in the next thirty years. And that would lead to more
than 30 million deaths and anywhere from five to
10% of lost global GDP. That’s anywhere from four to $8
trillion of economic losses. So, why is it tat we have not yet
built an effective response? Well, to do so, first, WHO has to be
much stronger and better resourced. We need to provide more funding for WHO and
put them in the position of leadership. We’ve got to build these systems
that I’ve talked about in every country in the world. And we also have to find the incentives
for appropriate vaccine and drug development so that the companies that can actually
make them are involved in the process. Also, we need pre-arranged agreements. I got phone calls from FedEx,
and from DHL, and from Vodafone saying how can we help? And because we had not
pre-negotiated these agreements, they played almost no role. Indemnity for drug companies that had vaccine candidates had not been worked
out and it took forever to get past that. We need to get those
things in place quickly. Also, instead of waiting, we were the ones who put the first big
money on the table for the Ebola response. But that happened in August,
eight months after the first case. We need instruments that will
disperse in eight hours, or eight days, and not eight months. And so we’re now developing
a concept that we’ve called the Pandemic Emergency Facility,
or the PEF. And the Pandemic Emergency Facility is
an innovation that would disperse funding immediately to national governments and
responding agencies to support a surge, a quick surge,
in capacity in the context of an outbreak. By doing this, the so-called PEF,
the Pandemic Emergency Facility, would eliminate the availability of
finance as a constraint on response. And it’s still unbelievable to me that
we waited eight months before really putting the money on
the table that was needed. So we’re looking at a lot of
different ways to do this. One is for this facility to leverage
resources from reinsurance and the capital markets, and spurring
the creation of a whole new market for pandemic insurance for
developing countries. Payouts would be immediate and
on the basis of a particular threshold. We have to come to agreement on what those
thresholds are, but we’re getting there. The thing that I like about this is
it would bring market discipline to crisis response by creating
incentives for data reporting and monitoring of diseases, and promote
investments in pandemic preparedness. Another possibility is for
donors to commit to providing funding to specific accounts that are already
linked to this global system but that would only have to be paid in
the context of a real pandemic. Now, I have to tell you,
when the pandemic is going forward, I get calls all the time saying, oh,
my God, this is potentially disastrous, we’re willing to put any
kind of money on the table. But then you have that high
level of awareness, and that awareness just
drops after a few weeks. So we’re in that trough where the interest
has dropped, but we can’t let that happen. And I’ve promised many people that,
as an infectious disease doctor, head of the World Bank,
I promise that I will not let it drop, and this is why we’re working on it. My friend Larry Brillion,
who some of you may know, said that outbreaks are inevitable,
epidemics are optional. We have to make sure that
things like financing, things like making sure
the WHO is where it should be, and all of the different structures
are in place to improve our ability to respond to pandemics and
actually build a system that will work. The momentum’s growing. Germany, which hosted
a G7 leaders conference, asked me specifically to come and
talk about this. Next year, we expect to have an even
greater opportunity in Japan where the G7 leaders, again, have put this
issue of pandemic response on the table. We’ve got to put the institutional
frameworks together. It’s going to be complicated,
but we cannot let another year, or two years, go by and
not have a system in place. With partners, we’re now also trying to increase
access to financing for health systems. And the purpose of doing that,
is that it’s not an automatic. The developing countries all over
the world are facing huge constraints. And so,
we need to find ways of incentivizing so we built something called the Global
Financing Facility in which the donors can put in money, and then we use our own
balance sheet, we use our own resources, to take that small amount of money and
then multiply it at a ratio of around 1:4. So with that money, we really think
that we’re going to be capable for the first time in history of
building systems that actually work. I want to stop because I want to have
a chance to talk with you a little bit, but let me just give you
a sense of where we are. So, in Guinea, Liberia, and
Sierra Leone 11,000 people died. But every single person,
every single American who was infected with Ebola and came to
the United States for treatment lived. So we heard mortality rates of Ebola,
80% is what we were told. But that 80% is only true if you
have no health system in place. If you have a system
like the United States, the mortality rate was empirically zero. What does that mean for us? How can we possibly talk
about shared prosperity and ending extreme poverty when you have that
kind of inequality every single day? Well, what we do at the World Bank
is pretty straightforward. We have a balance sheet. We do $65 billion worth
of business every year. And one of the great experiences for me
as a medical doctor was to finally learn what rich people do every day
to make themselves richer. And so we are now going to take our entire
balance sheet and do everything we can to ensure that the poorest of the poor
are getting access to those tricks, those fancy ways of using leverage,
and using swaps, and changes in swaps and exposures. We’re doing so many different things now because there is plenty of money in the
world and extreme poverty in prosperity. We could do it today if we wanted. If we just redistributed,
we could do it today. But we found that those kinds of approaches where you equalize
outcomes haven’t worked well. They just simply haven’t worked well. So what we’re focusing on is making
the kinds of investments that will really create equality of opportunity, and then
using our balance sheet every way possible to make it possible to provide energy, to
provide transport, to provide health and education, and
get to a point where by 2030 we will indeed be the first generation in
human history to end extreme poverty. Thank you very much for your attention. I look forward to taking your
questions in just a bit. [APPLAUSE]>>Thanks very much, Dr. Kim. As a physician, I just want to say first
off, that it’s completely inspirational to see you doing the kind of things
that you’re doing, and so we all owe you an enormous debt. And I’d also like to thank on behalf of
the Global Development Poverty Program, Seed, the GSB, and FSI. We’re absolutely delighted
to have you here. It’s interesting, a year ago when
we began planning this conference, of course Ebola was still happening and
it was very much on our minds. So this is the audience participation
part, I want to invite people, there are microphones. We want your questions,
that’s really the purpose of it. I’m going to kick it off with one,
but please step up to the microphones.>>And if students don’t ask questions
I’ll start calling on you, okay.>>[LAUGH]
>>I haven’t been in a classroom for a while, so yeah.>>So let me start with, I was strucken when you were talking
about the issues that you faced. You come from a tradition in physician
with evidence based medicine, and I wondered how evidence based
policy making might work. But the question is really, what are the
kind of things that you’d like to know the answer to now,
to do your job that you don’t know, and is there a way that the research
community could help with any of these?>>On one level, we just need to know more about what’s
actually happening on the ground. So there are many countries in the world,
where we haven’t got poverty data for the last ten years. So, we just need to
collect more basic data. But also,
I’m very encouraged by some of these randomized evaluations
that have been done. Jaime Sepulveda’s here in the audience and
the work that they did in Mexico, showing the impact of programs like
[FOREIGN] and others were just, they changed the way policymakers think. I mean, these were controversial programs. They were actually giving
cash directly to poor people. And inside the World Bank,
when I got there, I just couldn’t believe how many
studies we’d done on these programs. And I said why have we done so much on
something that seems so straightforward? You give poor people cash, you condition
it on them doing basic things like making sure their kids are fed and whatever. It seems like such a no-brainer. And they told me it’s
because ideologically so many people were against it, right. So there was this notion that
if you give cash to poor people, it will take away their desire to work. But it was all ideology, and
so we actually did a study and asked the question, do these programs
take away the desire to work? And the answer was no, absolutely not. It in fact, played the role of elevating
them to the point where they could begin to see the possibility of
joining the formal labor market. So I think there are so many questions
like this that we need to tackle. On the policy level, getting some system
where the World Health Organization, the World Bank,
other parts of the UN system, the private sector country bilateral
donors are all coordinated when that 1918 flu pandemic
style thing breaks out. That’s really hard to figure out. I mean how do you get
the governance right on that? Because what we found is that if you give
it to a UN or a multilateral, if you give it to us, we’re under so much political
pressure from our member countries, that you shouldn’t trust us to give
real data on preparedness, for example. Can we do this by linking
with the private sector? I’m not sure, but we’ve got to keep
experimenting until we get it right, because the stakes are just too high. You talk to these people in
the reinsurance industry, and they’re just panicked about this, because they hold all of the business
disruption policies, right. So if a pandemic breaks out and
all of these businesses have to stop, they are essentially facing
the end of their own business, because it would be catastrophic for them. So, the risk is so high and yet
are preparedness is so low. How do you build global
governance systems that would attack those particular global public
bads, that we just simply neglect? I mean,
climate’s another one very much like that.>>Absolutely, as someone who
does infectious disease modeling, I share their concerns, certainly. I think we have a question back here.>>Hi, my name is Andrea Sprockett, and
I work for a non profit called Metrix for Management. And I think it’s extremely laudable
that the World Bank has committed to serving the poorest 40% of the population. Part of being able to reach this goal,
is being able to measure it. So, could you talk about how the World
Bank is measuring how its programs that are designed to serve the poor, are reaching those poorest
two quint wealth quintiles.>>Yeah, the revolution in measurement has
happened in a number of different ways. One of the things that
I’m most excited about, especially in the area of health, is
something called the Program for Results. And the Program for Results doesn’t, we
agree on a certain package, whether it’s our most concessional loans, or our sort
of quote on quote more market rate loans. And then what we say is, let’s agree
on what the outcomes are going to be. In the area of health for
example, it’s malaria bed nets, or in the case of stunting, the right package
of interventions to prevent stunting. And then we don’t disperse until after
they show us that they’ve achieved a certain result. And so, it was incredibly controversial
inside the World Bank when we started it. But the outcomes have been just
astounding, really, really good. So, it’s not just even waiting until
after the program is done to measure. It’s not dispersing until
you show an outcome. Now we started off with just
5% of our portfolio, and now we’ve gotten approval
from our board to go to 15%. There are other things that we do
that are more sort of budget support. Where we agree on a certain
number of policy outcomes. We ask them to do certain things ahead
of time before they get the loan, and then the loan goes into their budget. And then we follow so
that certain policy changes are in place. But we audit every single
one of our projects, and you can look at the outcomes of every
single one of our projects on the Web. My predecessor Bob Zelick,
opened this up to everybody. Now are we measuring the right things? We’re not convinced, and we just made
a commitment to do household surveys every three years for
every country in the world. Now, it’s a huge commitment, its many hundreds of millions
of dollars of a commitment. But we realize that you can’t track, see the thing I learned from three by five is
that even if your numbers are not perfect. If you have the best numbers of anybody,
you can actually create rhythm and pressure on the system, and
that’s what we need to do. We need to find out where
poverty is going down, where the bottom 40%’s
incomes are going up. And you can’t do it
without household surveys. So it’s a huge commitment for us. But we think it’s the right thing to do.>>Question here.>>Hello, my name is Galina Fedorova. I’m CEO of GOODdler, it’s Enterprise
Software to Fight Extreme Poverty. And my question to you would be, the global goals are pretty
ambitious you would say. And limited resources. A lot of conflicts. And in one of your speeches previously
you mentioned that involvement of global citizens will
be a big part of that. So can you tell us what World Bank
is planning to do to involve global citizens in the process?>>Yeah. Well, so
just on that question specifically. We work now with something called
the Global Citizens Festival movement. And every year in Central Park, they have this really cool concert
with a With celebrities, and so this year I was on stage,
Kerry Washington from Scandal. Which I’m addicted to by the way. Because the person who put it together
is a Dartmouth Grad, Shonda Rhimes. Anyway, Kerry Washington introduced me,
right? And Beyonce was onstage and I would get to
hang around all these cool people, right? And the idea is to create
a global movement in poverty. Now, I’m not sure if this will work,
but it’s fun, right?>>[LAUGH]
>>And I told my, I have a 15 year old and a 6 year old, and so they thought,
well, we’ve seen dad with these people. But now we’re working with
Novak Djokovic to work on stunting. Novak is amazing. I mean, he grew up in war-torn Serbia. He had an opportunity. There were a lot of others that did not. And he really wants to make a commitment. So my 15 year old son tennis player now
thinks that I’m cool because I hang out with Novak Djokovic. And we actually sat in his box during
one of the US Open Tournaments. My six year old,
at the Global Citizen Festival, I got to appear on stage with Big Bird,
right? So, now even my six year old thinks I’m cool because I get
to hang out with Big Bird. Look, I don’t know if this will happen but
here’s what we have to do. And again, what I would say to all of you,
and it’s so good to be in the business
school because the one thing that I regret now that I’m the World Bank
Group President is it took me this long to really think hard about finance, right? Because there’s so
many things that you can do if you have a balance sheet that you
wouldn’t be able to do otherwise. So with this new sustainable development
goals, 117 goals, 169 targets, it’s huge. The Secretary General asked us to come
up with a vision for how we can pay for all of it, and it’s a multi-trillion
dollar agenda every year. So we actually sat back and
said so what would it look like? Well, first you have to start
off by improving tax collection. We think that poor countries can
improve tax collection 2 to 4% of GDP. That’s a huge amount of money that
rivals the amount that is given every year with official
development assistance, right? So if we stop the illicit financial flows,
literally people taking money and leaving, or you know companies not
paying taxes in poor countries, we can also increase the amount
of money for development. And then there’s grant-based official
development assistance, there’s concessional loans, there’s public-private
partnerships, and private sector. So we think that altogether we can
find the trillions of dollars needed to tackle this huge development agenda. But I think also young
people have to get involved. I don’t yet see the young people’s
movement around climate change that I think we’ll need in order to really wake
up and get to below two degrees Celsius. We’re not there yet. So engagement is really critical, and so that’s why you’ll see me with Novak and
Big Bird and everyone else. Do we have students? I’d love to hear from some students.>>Now he’s really glad he
did it in the World Bank. Sure, in the back.>>Hi, my name is Joad Nebusi,
I’m a student at GSB. I also found a not-for-profit in
Egypt that focuses on illiteracy for primary education students where 70% of
the kids in school cannot read and write. My only little interaction with
the World Bank has been a bit confusing, is that my perception is
that they’re helping the world and the NGOs, but
when I approached the World Bank and tried to get support, the thing is, they
said, we focus mainly with governments.>>Yeah.>>And we did actually manage to get
some money which is [LAUGH] good. But the fact is, I felt that there’s
maybe some kind of leeway or space where the World Bank
can also try to fund and help smaller NGOs in which they can
maneuver much quicker and maybe be some kind of a connection between the
government and the people on the ground. So, do you see any hope of the World Bank
kind of moving or shifting towards working with some different NGOs on the ground, or
you think just governments and that’s it?>>Well, so
we’re essentially a cooperative, right? A cooperative of 188 member countries,
and we provide loans. And the loans are based
on sovereign guarantees. In other words,
the country themselves guarantee the loan. So it’s very hard to do that with
multiple NGOs, but even though it’s hard, we’ve done it. So we have something called
a global program for social accountability, where we
started with a small amount of money, 20 million, the Ford Foundation,
the Source Foundation put money in. And we’re beginning to provide
grants directly to NGOs, but they would be grants. Now, once we provide
funding to a government, though, the government can now make
their own decisions about whether they utilize NGO’s, or the private
sector to provide the services. So at that point, because it’s
based on a sovereign guarantee, we have to go through governments for
the public sector side. We also have a huge private
sector practice where we make loans to companies that want to
work in developing countries, but also we take equity positions
in those companies as well. So if you have a private sector company
that’s trying to solve some major problem in a developing country,
come talk to us. Because once again we have
a very strong AAA rating, and we can provide financing
on relatively good terms. But even more important than the financing
that we provide, if you come to us and the private sector group is called the
International Finance Corporation, IFC. And IFC invests in your company,
it’s almost like a seal of approval. And then it’s much, much easier to crowd in other investors
to get your company up and running. So, that’s just simply the way we work and
the way we’ve been invented.>>Next question over here.>>Hi, my name is Nahama, and I’m a student in the International
Development Practice Program at UC Berkeley. I read a lot of stuff that both you and Paul Farmer have written
about partners in health. And the main two takeaways
that I had from that was that a grassroots approach is really important. And secondary, that the approach that you
go into one community with cannot just be taken and applied to another community. So I’m wondering with your work at
the World Bank, which is very top-down and kind of tried to take economic policies
and applied them across developing countries, how have you been able
to reconcile these points of view?>>First of all, the question is,
what do you mean grassroots? Right? It’s a complicated question. I have to tell you that if
you were to say to me that our biggest impact has been on things
like multidrug-resistant TB and HIV, because we changed, fundamentally,
the way people thought about it. And none of those ideas came to us,
necessarily, from the community. They didn’t come and say, we really think
you should treat multidrug-resistant TB with second-line antibiotics. That’s not how they think
about those things. And so, for me, the most fundamental
takeaway from Partners in Health is that we started with a very
clear ethical, moral principle, which was to make a preferential
option for the poor. And then from there, we said, so, given
that our goal is to make a preferential option for the poor, what is it that
we should be doing as medical doctors, as people who live in wealthy countries? And the conclusions were
kind of unexpected, right? And I know what you’re saying, and
many people come to us and say well, you should only do what the people want
you to do in a particular community. But I’ve worked in so many communities,
and sometimes the people in those communities can see exactly what they
want, and then that’s what you do. But I think what we’ve done is to say,
okay, we can’t do everything. We’re not going to do a feeding
program everywhere we go. What we’ll do,
is try to look at a particular program and engage with you, and say,
here’s what we’re seeing. What are you seeing? And then once that process of engagement
happens, you come together to a conclusion about what is to be done, which is exactly
what we do at the World Bank Group. We do our own analysis of what any country
needs to do in order to grow its economy, invest in its people, ensure that poor
people don’t fall back into poverty. But then, once we do our analysis,
we take it the country themselves. And it’s usually Ministers of Finance and
others and say, and also civil society now participates
much more than before. What is it you think your priorities are? And then if we can come to an agreement,
then we go forward. So I’ve heard this before,
you’re top down and we’re. Let me just put it this way. I don’t think my philosophy, the notion
of a preferential option for the poor has changed one bit since I worked in
the slums of Lima and in rural Haiti. I just have 65 billion
a year I can put to it now. So, why do you think that eight
months after I took the job, we established a goal of
ending extreme poverty? Because it’s the ultimate
way of expressing your belief in a preferential option for the poor, which is the foundation of
everything we did at Partners in Health. So the World Bank Group,
this great huge institution, endorsed this notion of a preferential option for
the poor eight months after I took over. So now, everything we do I can go back and
say okay, fine, I understand that, but how’s that going to
help us end extreme poverty in the world? And because I can ask that
question over and over and over again inside the World Bank Group,
it’s actually changing what we do. Partners in Health continues
to do this great work by tackling seemingly intractable
issues in the poorest communities. And now my job at the World Bank,
is to take those insights, like what I talked about today,
community health workers, and scale it up. That’s what we do. We do scale. We take great innovations that come from
the grassroots, and take them to scale. Question over here. Hi, I’m Tom and I’m from the Stanford
Daily, the student newspaper here. You recently wrote about your
experience as a migrant, and spoke about the importance of
tackling the refugee crisis. So my question is,
how would the World Bank make sure, or at least encourage,
individual countries to develop concrete domestic institutions
to tackle these crises? Great question. The article I wrote was in
the context of a report we put out. We do something called the Global
Monitoring Report, and this year, or this particular issue was on demographics. And what we showed was that in
a lot of advanced economies, their aged population’s increasing,
their working population is shrinking, and their birth rates are low. So for them, the most important
thing that they could do, in many ways from the perspective of
economic growth in the medium and long term, is to attract migrants, right? And I said, I’ve said many times is
xenophobia turns out to be a terrible economic policy for advanced economies. Now that was taken out of context, I was accused of calling certain
countries xenophobic, which I was not. But, there’s so much great
evidence now that suggests to us that xenophobia is a bad
economic strategy. Sexism is a terrible economic strategy. South Korea has the lowest female
participation in the workforce of any OECD country. And you can actually measure how many percentage points of GDP they
would increase, if they just set up a social structure that women
can participate in the workforce. It turns out that ageism, not listening to young people
is a terrible economic strategy, because young people are coming out
the digital world completely differently. So, what we’re trying to do
is put that evidence in front of our member countries, right? That xenophobia is a bad strategy, sexism is a bad strategy,
marginalization, inequality. We’ve got lots of data now that very
high levels of inequality actually slows economic growth. So all these things that I used to
proclaim, not based on evidence, and only because we thought
it was the right thing to do. It turns out that now, we have evidence
that suggests it’s economically, also the right thing to do. Isn’t that great? I mean, I think that’s just, that’s great. But it’s not simple. And so one of the things we’re doing is,
we’re trying to create employment opportunities for
Syrian refugees in Jordan. And how do you do that, because
where’s the money going to come from? So we’re working with the UK,
with the European Union and the Jordanian government to try to create
very specific employment projects for Syrians, but also for Jordanians. So if we can find a way to go out and
raise a bond, but then have the UK buy down the interest. And then open up European markets,
preferential access to European markets for the products made
in these little projects. We could actually create a level of
stability in employment for refugees that would not otherwise have happened if
we would, sort of stayed in our own boxes. So, we’re looking across
the Middle East Into Africa to find much, much better ways of dealing with refugees. The fundamental point is,
we have separated political negotiation, humanitarian response and
development, forever. And we are now saying we can’t do that
anymore, we have to bring all of those together, and think about, how do you,
prior to a conflict happening. How do you think about regional
development initiatives that might actually lower the possibility
that a conflict reroute and then you’d have to mount
a humanitarian response. Not easy, but we’ve got,
the standard approach has worked so poorly for so long that we’re
going to try all kinds of new things. With that, unfortunately,
we’re going to have to close. Please join me in thanking Dr.
Kim for his talk. [APPLAUSE] [MUSIC] Stanford University.