focus its efforts and resources on the long - term challenges of poverty eradication and sharing prosperity in the poorest countries. with these goals in mind, we expect that a larger group of countries will consider mobilizing resources. we welcome progress in leveraging ida equity, which will enable the bank to both target scarce concessional financing to the poorest ida clients and increase allocations of non - concessional resources to countries at a more advanced stage of development, in line with the different needs and capacities of ida ’ s evolving client base. we support the proposal of a window in ida18 to leverage ifc and miga to promote private sector development in ida - only countries, paying special attention to fragile conflict situations. we nonetheless think that the best way to promote private sector activity in these areas is to address the challenges related to institutional capacity and regulatory framework. 4. the forward look we welcome the report on the year - long engagement between the board of directors and senior management on the medium - to long - term role of the world bank group. it provides an important basis for the decisions shareholders should make on the financial capacity. given the ambitious agenda of the 2030 sustainable development goals ( sdgs ), the wbg should help address the issue of why the large amount of global liquidity flows only to a limited extent towards capital - poor countries. while this may still be due to global capital market imperfections, differences in fundamentals that affect the structure of these countries ’ economies — such as technological capabilities, missing factors of production, government policies, and institutional structure — play an important role. therefore, the crucial role of the bank is to build on the knowledge accumulated in so many years of financing for development and help developing economies overcome such shortcomings. in particular, helping countries implement the policies most conducive to a friendly business environment is essential to leverage private sector investments. we recognize that an appropriate funding of the measures to achieve the sdgs in a challenging global economic context may put pressure on the wbg ’ s financial resources. as the world bank ’ s scope of intervention cannot be unlimited, particularly in an international environment where many organizations share the same broad goal of helping the poor, scarce resources should be used with greater efficiency. we need a more intense coordination among all multilateral actors, building on their respective missions and expertise. we strongly recommend an optimized use of resources and enhanced selectivity of interventions, firmly grounded in the bank ’ s comparative advantages, with a

will use the dollar simply because you and everyone i do business with uses the dollar — that is, there is a network externality associated with using the dollar. but the international financial consequences of the euro will be driven most importantly to the extent euro - denominated assets play a growing role in global portfolios, displacing to some degree the role of dollar - denominated assets. such an expanded role for euro - denominated assets would depend upon and follow from the development of a broad, liquid euro securities market to rival the dollar securities markets. but i am talking only of potential. a growing and ultimately significant international role for the euro is not automatic. instead, the euro area will have to earn its place in the international financial system, and earn it the old fashioned way — by pursuing policies that produce a healthy euro - area economy. by improving price discovery within the euro zone, the euro itself may increase competitiveness across europe, and thereby benefit low - cost producers, trade competitiveness, and european consumers. but the key to the success of the euro area would still appear to be the same set of policies that would have been essential in france, germany, and other euro countries in the absence of the euro : structural reforms, especially those related to reducing the rigidities in european labor markets, and disciplined monetary and fiscal policies. does the euro make structural reforms and disciplined policy more or less likely? frankly, i do not know the answer to that question. fortunately, we do not live in a zero sum world. the structural reforms and monetary and fiscal policies that would make the euro area stronger and more competitive would certainly enhance the strength of the world economy as well. whenever the world economy is strengthened, the u. s. benefits. however, this should not lead us to understate or neglect the significant changes in trade flows, current account balances, and exchange rates that might be part of the transition to an increased international role of the euro, and the importance of careful management of this transition. it is only fair, however, to warn my euro friends that having a preeminent international currency has its pluses and minuses — it is not an unmitigated free ride, as some of the discussion has suggested. there is a burden that accompanies having an international currency. policy changes that are undertaken for domestic purposes can have important effects on others, effects that are magnified when a country or region is not only a large part of