 Good morning everybody. Good morning, and thank you everybody for joining us on a rainy pre-hurricane morning. Thank you for joining us for what I think is a very important discussion. My name is Nancy Lindborg. I'm the president of the United States Institute of Peace and for those of you who are not familiar with us, USIP is an independent federal institute that was founded by Congress for the express purpose to develop practical approaches to preventing, mitigating, and recovering from violent conflict. And so we work in conflict zones around the world connecting our field programs with research, with training, and with policy recommendations. And we know, as many of you do, that conflict is inevitable, but violence is not. So it's when violence occurs that lives are lost and that development gains are overturned. So the big vision is a world without violent conflict. And of course, we're all of us here because we're all in the business of big visions. And that holds especially true for today's speaker. So I'm just delighted that we're joined here today by Dr. Jim Kim, who has been harnessing big ideas and building visions throughout his career as he's driven forward solutions, catalyzed change, and pushed for global collaboration. Trained as a physician and an anthropologist, which I think is a phenomenal combination, Dr. Kim has dedicated his career to international development, helping to improve the lives of underserved populations worldwide. He was president of Dartmouth, co-founder of Partners in Health, and a former director of the HIV AIDS Department of the World Health Organization. So throughout that pathway, Dr. Kim has brought renewed purpose and focus wherever he's worked. Under Jin Kim's leadership, the World Bank is really leading the charge on ending extreme poverty. And in his established goals, he's committed the World Bank Group to end extreme poverty by 2030, while also boosting what he describes as shared prosperity. So I'm especially pleased to have Dr. Kim here today as we saw last week the adoption of the sustainable development goals at the UN General Assembly. And these goals set out a very ambitious new pathway for the next 15 years, including the historic inclusion of my favorite goal, goal 16, which caused for inclusive, accountable, and participatory governance with equal justice for access. And coming up, of course, are the World Bank's fall meetings. So we're at this critical moment where the development enterprise is really having this important conversation about how do we reboot for the challenges ahead. I also just want to note that I had the opportunity to see Dr. Kim in action as the Ebola outbreak in West Africa escalated into a truly terrible global crisis. And Dr. Kim stepped up to help us forge this collective understanding of what was the most effective strategy and, most importantly, a sense of joint global purpose, which was absolutely essential for the kind of urgent action that was needed to combat that virus. This is the kind of urgent action we need to bring to the challenges for the next 15 years in the development world. So I very much look forward to the conversation about how the World Bank is continuing to do this and how we as a global community should come together. And here to have that conversation with us, please join me in welcoming Dr. Jim Kim. Thanks so much, Nancy, President Lindborg. Ladies and gentlemen, you know when I was at the university, rain usually meant we lost about 80% of our audience. So I'm really grateful to all of you for being here today. I'm especially grateful to be speaking today at the United States Institute of Peace, whose core principles begin with the pledge to bring peaceful solutions to the world's problems. Today, the world's problems seem daunting indeed. Economic growth is slowing. Many countries remain locked in war. The number of extreme weather events continues to rise, and every day we see, by the tens of thousands, the anguish of families who've lost everything, in some cases risking their lives to cross from the Middle East and Africa into Europe. With all these global threats and daily tragedies, it can be hard to imagine a world in which prosperity is shared by all. When we look at it all together, slowing growth, climate havoc, pandemic threats, families' escape and conflict or poverty, it forces us to rethink fundamentally the development enterprise. But I know that we can succeed in achieving the twin goals of the World Bank Group, to end extreme poverty by 2030 and to boost shared prosperity for the bottom 40% of the population in developing countries. In the face of all the shocks and crises I mentioned, the World Bank Group focuses on the extreme poor and the bottom 40%, because they are the most affected and the least able to recover. Over the last few years, a related discussion on inequality has taken hold, partly as a result of the financial crisis of 2008 and 2009. Last year, Oxfam laid down an unusually sharp challenge in its report, Even It Up, stating that the richest 85 people in the world control as much wealth as the bottom 50% of the world, more than 3.5 billion people. By highlighting the stark reality that so much of the world's population shares almost none of the world's wealth, Oxfam touched a nerve. The World Bank Group's approach to addressing this problem is embodied in a term that suggests a solution, boosting shared prosperity. In our work with governments, we support efforts to ensure that everyone benefits from growth, not just those who already control or have access to capital. We know that to boost shared prosperity, the incomes of the poorest 40% must grow, ideally at a rate that matches or exceeds the rate of income growth for the general population. But since 1990, labor income in most countries has grown more slowly than national GDP. More recently, inequality has increased in the United States, as well as much of Europe, China, Indonesia, and India and Indonesia, about half the world's population. But the news isn't all bad. Of 94 countries in our global shared prosperity database, 65 of them, which comprises about 73% of the global population, have enjoyed mean income growth for the poorest 40% between 2007 and 2012, despite the financial crisis during that time. And in 56 of the 94 countries, growth in the bottom 40% has been faster than for the population as a whole. So the poorest people have not always been left behind. We know that people will earn higher wages when markets are more efficient for everyone and governments provide better access to quality health services and education. More income for more people increases demand and consumption, leading to still more investment, both public and private. For us, then, to reach our twin goals, three things have to happen. Inclusive economic growth, investment in human beings, and insurance against the risk that people could fall back into poverty. Grow, invest, ensure. That's our shorthand for the strategy. Of the three, economic growth, accompanied by rising wages and job creation, has been the most important factor in reducing extreme poverty over the past half-century. But we're not focusing simply on growth of GDP. We reject trickle-down notions that assume that any undifferentiated growth permeates and fortifies the soil and everything starts to bloom even for the poor. We need to find an economic growth model that lifts up the poorest citizens rather than enriching only those at the top. But what do we do in an era of low global growth, such as we're living through right now? One answer is to encourage and help all countries to do what they can to boost growth, which often means tough measures and reforms like ending regressive fossil fuel subsidies, improving the business climate, and making public expenditures more efficient and targeted. Developing countries must also construct more equitable, efficient, and transparent tax collection systems. IMF managing director Christine Lagarde and I pledged a few months ago that our organizations will do everything we can to help countries collect more taxes more fairly. In too many countries, the rich evade paying their fair share. Some companies use elaborate strategies to not pay taxes in countries in which they work. This is a form of corruption that hurts the poor. More equitable taxation could easily eclipse official development assistance received by countries. At so many of the recent meetings I've been to, developing countries have been clear in their strong desire to improve their domestic resource mobilization and take important steps forward toward greater self-sufficiency, which in turn will allow them to offer more services to their citizens. Efforts to boost shared prosperity will differ in each country. A low-income country may need to ramp up agricultural productivity. Middle-income countries may focus more on urbanization, building safe, clean, livable cities. For a country where most children don't go to primary school, this has to be the first goal that is achieved. But for every country, we're doing everything we can to help our clients stimulate inclusive economic growth. And when growth is slowing, this is the time we have to focus even more on our efforts to do the second two things, invest and ensure. Investing in health and education, as we now know, promotes economic growth. Furthermore, social protection programs have been shown to stimulate local economies as well as shield the disadvantaged from falling back into poverty. In Latin America, where we'll hold our annual meetings next week in Lima, Peru, there are several programs that beautifully combine elements of the grow invest and ensure strategy. Latin America was one of the most unequal regions in the world throughout the second half of the 20th century. But in the 21st century, it's become markedly less so. Growth in these countries led to higher hourly wages and governments adopted a number of policies that have had real staying power. Enforcement of labor contracts and a minimum wage, greater access to schools, progressive educational spending that favors the poor, pensions, and above all, conditional cash transfers for which there's abundant evidence that giving cash rather than regressive subsidies for fuel or food produces lasting positive effects. Peru's Programme Juntos, which began in 2005, has reached half a million poor families with conditional cash transfers worth $38 each month based on regular health and nutrition checkups for young children. Brazil's Bolsa Familia benefited 14 million families and helped cut poverty by 28% in the last decade at a cost of only 0.5% of GDP. Opportunidades in Mexico, now called Prospera, is a conditional cash transfer program where one quarter of recipients' income was saved and reinvested in productive small business or self-employment ventures. Throughout the hemisphere, 15% of the fall in inequality was attributable to these progressive social protection transfers. No matter the level of prospects for economic growth, we have to increase our efforts to ensure poor people against the risks and looming disasters of modern life. Well-off people already benefit from various forms of insurance, but everyone should have a safety net. Too many people are living just one illness or accident away from destitution, even in a rich country like the United States. We've also learned over the years that investing in people, especially in their health and education, is one of the most critical actions countries can take to promote economic growth. Two weeks ago, 267 of the world's leading economists organized by Larry Summers, a group that included Kaushik Basu, our chief economist, and several of our colleagues at the World Bank, signed an appeal in the Lancet for governments to invest in what they call a pro-poor pathway to universal healthcare. In their declaration, they state that over the past decade, health improvements have accounted for fully 24% of full-income growth in low-income and middle-income countries. The economic benefits of universal healthcare are 10 times the cost, and it's a mission on which over 100 countries are now well underway. One of our most cherished and broadly shared values is the notion of equality of opportunity. In our quest to achieve equality of opportunity for all, we will have to invest in healthcare that will lead to what Larry Summers has called the grand convergence in health outcomes, only when everyone in the world can expect to receive healthcare and be healthy can we really seriously talk about equality of opportunity. Now among the investments in people we need to make, the most important one, in my view, starts when a woman becomes pregnant. It's the combination of health and education, of investment and insurance known as early childhood development interventions. 26% of all children under five in developing countries are stunted, a condition in which children are not only malnourished and under stimulated, but risk a loss of cognitive abilities that last a lifetime. In Sub-Saharan Africa, some 36% of children are stunted. That's nearly four in ten of Sub-Saharan Africa's children with limited prospects in life. This is a disgrace, a global scandal, and in my view, a medical emergency. When an infant brain is not fully developed, whether from malnutrition, toxic stress, or a lack of stimulation, the neural connections actually just don't form. Once a child loses those neural connections, the damage is permanent. To areas of the brain, and this is what's most troubling, to the areas of the brain involved in learning, emotions, and future responses to stress. An impaired prefrontal cortex affects the emergence of a young child's self-regulatory skills, cascading in a short time to serious problems for their executive function, working memory, and adaptability to change. What does this have to do with shared prosperity? Everything. Children who are stunted by age five will not have an equal opportunity in life. There can be no equality of opportunity without proper anti-natal care for mothers, or the appropriate stimulation, nurturing, and nutrition for infants and young children. Conditions of poverty, toxic stress as in situations of conflict, will have produced such damage that these children may never be able to make the best of any future opportunities. If your brain won't let you learn and adapt in a fast-changing world, you won't prosper and neither will society. All of us lose. At the World Bank Group, we're committed to effective action on early childhood development. We've identified five packages of 25 services for families with young children, all based on strong evidence. From 2001 to 2013, we invested $3.3 billion in early childhood development programs around the world in Haiti, in Indonesia, in Jamaica, Lesotho, Mozambique, Russia, and Vietnam. More programs in more countries are in the works, but we must do even more. Every country has to invest. What we need now is an ambitious goal that will help drive our work in early childhood development. For childhood stunting, there is in fact a goal set in 2012, a global target to reduce stunting in children by 40% by 2025. But that would still leave 100 million children stunted, and that's not ambitious enough. With strong leadership from UNICEF, the World Health Organization, from new partners, such as the world's number one men's tennis player, Novak Djokovic, whose foundation is working with us and the Serbian government to improve early childhood development programs, we must aim higher. If equality of opportunity is a value that we indeed all share, and we're serious about boosting shared prosperity, we need to work together to set a target to end stunting for all children as quickly as possible and well before 2030. But we shouldn't stop there. Even before primary school, all children should have access to preschool. In New York, last week, I met with President Santos of Colombia, who had just signed a peace agreement that could bring an end to the last remaining conflict in Latin America. Even in the face of conflict, President Santos has moved aggressively to increase access to preschool and ECD interventions, knowing that it's not a luxury of peacetime. This is the kind of leadership we need. Preschool is another great investment. Every dollar spent closing the gap in pre-primary education between the well-off and the poor will return between $6 and $17 for shared prosperity to endure so that people, once having lifted themselves from poverty and plunged back into it, we have to rethink our role in an unstable world driven by conflict, crisis, pandemics, and climate change. Who is most at risk during times of crisis? Poor people. Last year, Ebola struck three of the world's poorest countries, Guinea, Liberia, and Sierra Leone. The months of global inaction to fight the epidemic and the deaths of more than 11,000 people can be directly tied to the poverty of those countries. Many of those who died were among the extreme poor, whereas the survival rate among Americans, thank God, who contracted the virus was 100%. We must not do now as we've always done before. Panic, while the crisis rages, neglect when the headlines fade. The World Bank Group will not forget the lessons of Ebola. We're now working on a global pandemic facility that will effectively provide insurance to poor countries for whenever the next pandemic hits. To prevent the outbreak from reaching pandemic proportions, remember, outbreaks are a certainty, pandemics are a choice. The facility would rapidly release funds for trained personnel to respond immediately. Disbursements of up to hundreds of millions of dollars will support first responders. If they can stop the epidemic quickly, they will save many, many lives and prevent enormous economic losses. The facility will be a critical part of a larger pandemic response capacity we're currently building that we hope will finally, finally be equal to the challenge. If a flu outbreak like the one that killed millions of people in 1918 happened today, tens of millions of lives would be lost and the cost to the world would be somewhere between 5% to 10% of global GDP. That's four to eight trillion dollars. But today we're not ready to stop such a pandemic. And as with all natural disasters, it's the poor who will suffer the most. In difficult times, when we're concerned about growing inequality, worried about the health of our planet and future pandemics and outraged that one quarter of all children in developing countries are stunted, we must tackle the biggest problems with only the highest aspirations. Only then will we be successful. I've said it many times, when you're fighting extreme poverty, optimism is a moral choice. Pessimism in the face of extreme poverty can become a self-fulfilling prophecy that will surely be deadly for the poor. Our goals of ending extreme poverty by 2030 and boosting shared prosperity are not just slogans. We're serious about them and we have a plan. Grow, invest, ensure. This plan starts with a pregnant woman who lives in a conflict zone. We must do whatever it takes to support her so that her newborn child will have a world of opportunity equal to that of any child in the world. Bringing the rate of stunting down to zero will be an enormous task, but if we're serious about shared prosperity, it is in fact our task, our shared responsibility. Now is the time to get serious. Thank you very much. Thank you. You have given us a lot to think about here. And I'd like to invite everyone in our audience to join us for this question and answer period. We will be taking your questions and for those who are following us online, you can send in your questions as well. And please join us on Twitter with hashtag bottom 40. Hashtag bottom 40 for the social media mavens among us. So, you know, you highlighted a very ambitious and inspiring agenda. I mentioned in the introduction, you know, I'm delighted that the new sustainable development goals include goal 16, which talks about the importance of inclusive, accountable, participatory government, justice for all. How does the World Bank view that goal in light of the agenda that you've laid out and as a part of the three big approaches you've outlined? Yeah. Well, you know, we know that the governments that will be successful in reaching goals or getting programs done, it's pretty predictable. The places that have good governance, that have well-running institutions, well-funded and established institutions will always do better. So we absolutely know that governance and rule of law are critical. The question for us at the bank has been, well, so how do you actually help governments improve their governance? And elected officials come into office and, you know, they're not born with a sense of how to make a governmental bureaucracy work more effectively. So we've tried to work with partners to get very concrete about how to help improving governance, how to help improving rule of law. Like, you know, the taxation issue I talked about. You know, it's really stunning what could happen if governments just got better at collecting taxes in a fair way. Some have suggested this would be two to three times of visual development assistance. And a lot of it is just that the institutions don't work. So I think that now, with goal 16, we've got to take the next step and say, well, who's concerned about this? Who are the partners we can work with? How can we go forward together and actually hold ourselves accountable for real improvements? I mean, there are some governments that it will be very difficult to work with. I have to tell you, I found that across the board, especially new leaders, especially young leaders, they come in and they want to do better, but the question they have is, so what should we do differently by next Tuesday that will allow us to actually do better? We have to get better at providing that kind of support and we have to get better at working together with the right partners. This is what we're trying to do in every sort of major issue we go forward on. Who are the partners? How serious are we? Can we really work together to take the agenda forward quickly and effectively? And you don't get pushed back when you say the word tax? I know what it's saying. Well, we call it domestic resource mobilization. Great term. We're going to hear that on the campaign trail. We know what it means. The basic reality is that so many tax systems in developing countries are incredibly regressive. It's the poor people who have to pay every time they slaughter a goat and the richest families pay nothing. So transparency around that particular aspect of tax systems in poor countries. I think we just have to... I think we have to be transparent about it and we have to ask the people of those countries and we have to ask the leaders, is this something that you think is reasonable? Because it's being asked now in donor countries. They're saying, why should we provide support if they won't even collect the taxes in their own country? Some countries collect a very small percentage of GDP with their taxes and they know they've got to get better. We want to help. It's partly a political problem, but to the extent that it's a practical problem where they just don't know how to take next steps, along with the IMF, we've got to be in every single country and provide as much support as we can. You spoke very movingly about what happens to children under five in terms of brain development, both from malnutrition, which I think there's been deeper study on, but also these other toxic shocks and the impact of conflict that you really can't recover from. That's something that I don't think is really understood and maybe could change some of the choices leaders make as countries are plunged into violence or conflict. How do you see the bank moving forward on that? That's fundamental and powerful information. I'm very pleased that we're talking about inequality so much more. In beautiful mountain retreats and meetings in Aspen, we talk about it now and we talk about it more than before. But there's no way that you can say we're making progress on inequality if fully a quarter of all children in developing countries are losing neural connections. 700 to 1,000 neural connections are made every second. If there are high levels of cortisol circulating, the stress hormone circulating in people's bodies, those connections don't get made. Also simple things like, nutrition is a big part of it, but the interaction between parents and children. Babies are born in the world as learning machines. They're focused on learning and every time they make a sound or babble, they're looking for a response from the parents and if the parents don't give that to them, they literally get stressed because that's what they're looking for. We did this incredible study over 22 years. We were involved in it in Jamaica where we took stunts to children and gave them all different kinds of interventions. And the one intervention that had the biggest impact was when we sent young people to encourage mothers to interact with their children. They did it every week for two years. In that group that got that intervention, their income 22 years later was equivalent to those of non-stunted children. Everyone else was at least 25% less. And these other children were getting the nutritional supplements. So we now know so much more about that kind of interaction, but we also know a lot more about toxic stress. So in situations of conflict, if there's a constant conflict and there's no way to alleviate it through warm relationships or at least the stopping of the conflict, what happens is the expression of your genetic material actually changes. This is an epigenetic change that actually happens in your brain. And again, you cannot recover after a certain time. So the point I'm making here, I'm not just being a medical doctor and a development institution. What I'm saying is, if you're serious about boosting shared prosperity, you've got to get to when inequality begins. Inequality begins with a pregnant mother. Inequality especially begins with a pregnant mother in a conflict situation. And show your seriousness. If you just want to talk about these things at mountain retreats, that's one thing. But if you're serious about attacking it, we cannot have 26% of children in the world literally handicapped at the age of five and have any sense that we're serious about tackling this issue of inequality. That's where it starts. And we've got to make rapid progress. We see also from the perspective of peace builders that it's very difficult to build peace in a country that has multi-generational conflict. Where that percentage of toxic stress is probably even higher. And I'm not sure we have good data on that. Just something that would be good to work with. Something that we were talking about earlier. But one of the things that we've just had to recognize is that our approach to linking development and humanitarian response to peace building processes has just been terrible. We haven't done it well. And generally speaking, we've thought that development is something that happens after the humanitarian crisis and after peace treaties are signed as opposed to something that has to happen at the same time. Amen. So the fundamental realization is that refugees are refugees for an average of 17 years now. So these are not short-term problems. And so we're trying to truly fundamentally rethink how we help countries in conflict reestablish the social contract. We're trying to think completely differently about refugees. Can we help refugees start businesses? Can we upgrade dramatically the quality of education for refugees? Can we think differently about states? So Lebanon and Jordan has a huge percentage of their own population that is now coming from other countries, refugees. What do we do about that? Do we just sit back and say, languish for 17 years? We've just had some great conversations with leaders at the UN General Assembly where we're saying, we have to rethink this fundamentally. Can we take some lessons? For example, we now know that in Turkey last year, that has done it very differently. They've just sort of let all the Syrians come in and they're integrating into the society. 26% of all new businesses last year in Turkey were started by Syrian refugees. And in the areas where the most Syrian refugees have settled, economic growth has been faster than in other parts of Turkey. Take it a step further. You look at a lot of the advanced economies and we're just putting out a report on demographics that looks at this. In advanced economies, the elderly population is increasing. The working population is shrinking. The birth rate is declining. So the strategy for those countries is to welcome immigrants. It should be. The economic strategy we're saying is that's the way it should be. I'm an economic migrant. We are an economic refugee. We came from Korea in 1964 when Korea was an extremely poor country looking for opportunities. I have to tell you at first, I didn't really feel like I was going to be welcomed as an American. I grew up in Dallas, Texas and in Iowa. Many people had never seen an Asian person before so it didn't really feel like I was going to be integrated into the society but over time things have changed and it's been part of the American growth strategy to welcome immigrants and let them become hyphenated Americans. And so I've issued a challenge to my friends in Korea. When will we see the emergence of Syrian Koreans who feel that they're part of Korea? Well, Korea has a huge problem in terms of a shrinking workforce and a reducing birth rate for economic growth. That's my story. I'm sticking with it. Let's open it up for questions. If we can bring the mics. Let's start with Lindsay. I see over there. And we'll take a couple. Good morning. I'm Lindsay Coates from Interaction. Thank you so much for the very inspiring remarks. I have a question though that's a little sticky. So I'm a big fan of SDG-16. I think it's terrific. I also think domestic resource mobilization is critical. So I'm glad to hear your remarks on that. The problem I see and the question I have is what is the World Bank group's appropriate role in the political problem of those domestic resources actually going toward human well-being? Because, you know, we fight in this country about funding for Head Start and we don't fight as much about funding for bombs. You know, Lindsay, at the end of the day, ultimately, you know, nation states have to make their own decisions about how they utilize domestic resources. But what we can provide is overwhelming evidence that investing in your people is the most important thing for you to do. And this is relatively new. So I just, you know, I can't tell you how incredibly grateful we are to Larry Summers for having done this now for about a couple of years. He said that, you know, if you don't invest in healthcare, you either can't count or you don't care because the numbers are very direct. 20 years ago, as you know, Lindsay, 20 years ago I was part of the trying to close down the World Bank Group. And part of it was because part of it was because we didn't think, we think the World Bank Group, we thought at that time, and this is why I gave the speech I did today, was too focused on just GDP growth. But to be fair, 20 years ago we just did not have the evidence of the direct connection between investments in health and education and economic growth. Now it seems like a no-brainer, but it's still very hard to get finance ministers to make that choice when they've got critical infrastructure to build when they have to provide more energy for their people. We need to get more effective at making the economic case and celebrating when they do the right thing about investing in people. You cannot go into the world with a quarter of your future working population stunted and think you're going to be able to compete. You know, so many things are changing. Will the path to economic development and industrialization even include manufacturing in the next couple of decades? You know, robotics and 3D printers. Will that take over all of manufacturing? Well, if that does happen, then the one thing that you're going to need above, anything else you're going to need, healthy people who are able to learn and adapt to new economic circumstances. So we are making that argument very strongly. That's why I gave this speech. That's what we're going to keep saying. It is no longer sort of investing in people is no longer something you do after you've done everything else in your budget. This is part of your growth strategy and it's what you leave for your children in future generations. Without it, you're not going to be able to compete in the future. Healthy people able to learn and able to manage conflict. So violence doesn't undercut all your development goals. This is why we're so fundamentally trying to do what we do. We have to just admit it's not worked. Whatever we've tried to do has not worked. So now the question is can much more aggressive efforts at economic development, at job creation, at better education in conflict zones, is that something we can do quickly and is that something that we can do that will actually have an impact on the conflict? We don't know, but we're going to try. Right. As they say, never waste a crisis. So the hope is that the Syrian refugee crisis will really push us into new, creative, important ways of moving ahead. We're already seeing it, Nancy. We're already seeing the conversation has shifted and at the UN General Assembly, the conversation was fundamentally different. People were really trying to look for different ways of approaching it. We hope to have some announcements soon about what we're going to do. Let's go back to the audience. We have a question from Kashif Ali in Islamabad. So you have a far-ranging audience today who asks in most developing countries the economy is based on agriculture and taxation that hurts the poor farmer the most. How do you improve that system? That's exactly right because taxation systems, and I've seen this in many places I've worked, where peasant farmers that we've worked with have to pay a fee every time they slaughter a goat. And then in one country that I've worked in there's a list of 10,000 or so, I don't know the exact number, wealthy people who are by law exempt from paying taxes. This just makes no sense. It's the ultimate regressive tax system and they're everywhere. And so what we're hearing is that there is new courage and new conviction to change that situation. And so this is why Christine Lagarde and I just jumped right on top of this and said, okay, what can we do? Can we set a target for increased domestic resource mobilization? Can we set a target for making tax systems fairer and more progressive? I hope so. We'll see. I mean, that's what the countries want. They want their own resources to be able to manage their own development process going forward. We will keep, as Lindsay mentioned, we will keep stressing that investing in people is an excellent thing. And this could really mark a new period in development. Great. We have a questioner over here. My name is Lee Young. Thanks for your presentation and wonderful forum. I think if you I mean World Bank or United Nations, if you can really do something about liberty and justice, the problem now, everything we are talking about whether democracy, freedom, accountability or whatever, this seems all right. Even now we have an internet or a high tech, they are being used to obstruct or unjust manipulation of people's activities. So I just wonder if you can really do this effort. Thank you. We're going to take a couple of questions so if you can store that. Is there someone over here, right here? And then if you can stage up for this gentleman there. Hi, how are you? My name is Aron Sasu. I'm Peruvian and I go to school at Cornell. Looking at the situation in Peru and in Latin American countries and hearing what you said about SDG 16, I definitely agree that a taxation reform is very important but how do you deal with that when corruption is so ingrained in the system that that's a heavy reason why there's no taxation reform, why there's no investment in education and health care because corruption is such heavy problem and every hopeful and optimistic politician that enters the political spectrum in institutions is met with many politicians that are already corrupt and there's no way that they can work around the system when they're being threatened for their life or just enter this very ingrained system of corruption. Thank you, we're going to take one more gentleman right here. Hi, Richard Wannerman, Public International Law and Policy Group. Going back to your talk about refugees and post-conflict. Now that increasingly more ceasefires and permanent peace agreements are including economic development or at least reparations, do you in light of all of these comments about investing in refugee communities or refugee economies, do you see more of a technical role for the World Bank to play a part in negotiate or giving technical assistance to these ceasefire negotiations whether in Columbia or elsewhere as we see more of them globally, predominantly in lower income countries. So data sets that people don't have confidence in corruption and corrupt politicians all the good challenges and peace agreements. So I think there's a broad recognition that we need much better data and it's something that the Gates Foundation has really gone after and it's something that the US government, I mean President Obama has made it clear that this is going to be a huge priority for him to include better, to collect better data around everything that's happening in development and for us as well. I mean we're really thinking hard about how much more do we need to invest in getting better data going forward and the conclusion really has been that there's almost, it's almost impossible to invest too much in getting better data. It's for a lot of different reasons, first of all just the truth-telling part of it but also having data will help us to shape our activities. You don't know if you're getting better unless you have better data. So I really hope that what you're going to see over the next few years is a revolution in how we think about data collection. It's going to become very, very important. So thank you very much my friend Peruana. I've been working in Peru for now starting in 1994, so more than two decades. In 1994 the very first project we did in a squatter settlement. Are you from Lima? So where we started was Carabaillo, right? When you were born, Carabaillo was a bedroom community for Senderu Luminoso, the shining path and there was nothing there and we built a little pharmacy, a little rotating pharmacy next to the church. And on New Year's Eve 1994 they blew it up and they said that they were representatives of the shining path and they wanted to stop these little projects that were deceiving the people and delaying the revolution. So that was my start in Lima. We had to drive about 30 minutes into Independencia to use the one phone line that was available and inequality was off the charts. There had been bouts of hyperinflation where people in Carabaillo when they got their paycheck would spend every penny of it buying things at the first of the month because they knew that the value of the money that they got the first of the month would be devalued tremendously by the end of the month. So monetary policy was a mess and conflict was rife, inequality was enormous, huge numbers of people living in poverty. Since then Peru has been an incredible success story. High rates of economic growth the number of people living in extreme poverty have been halved. The incomes of the bottom 40% have grown faster than the overall incomes during all these years and amazingly stunting was brought from 28% to 14% in a short period of time. Now it's all part of what's been happening that's so positive in Latin America is a real focus on equality a real focus on access to services so all of that happened in a context where yes there was corruption so what I hear so often is people say oh there's all this corruption and you're right everyone who says there's all this corruption is right but there's corruption here too there's corruption everywhere, corruption is sort of part of the human condition the most important thing is that you never use corruption as an excuse not to focus on the task which is for us any extreme poverty and boosting shared prosperity we work in situations where there's corruption and every time we see it we call it out so over the last 20 years there's less corruption in our projects, still corruption around our projects but that doesn't mean we stop because we're judging the corruption we can't stop because there's still poor people in those countries so the best thing you can do is continue to go at it and know that even in settings where there is corruption you can make a lot of progress and the other one was yes, real it's written into our articles of agreement that we can't be involved in the internal politics of a country so we probably won't be involved in negotiations but for example if we can link peace agreements to funding and we didn't do it officially but here's what we've been doing the Secretary General and I of the United Nations and I have been traveling together and when we went to the Great Lakes region he went and at the same time he signed an 11 state agreement on a peace process and we put on the table about a billion and a half dollars for regional integration that would improve trade amazing in these countries the trade barriers are enormous there's like 50 stops you need to make to go from one country to another between the DRC and Uganda for example so we put money on the table for regional initiatives that would greatly improve the economy of the region but it was clear if not official it was clear that this would only go forward if they stuck with a peace agreement this is what we're trying to do now go in and negotiate the peace while at the same time going in with the UN and trying to see if we can link development projects that would make people more likely to stick with the peace agreements that's what we need to do when we arrived in the Great Lakes the first trip that the Secretary General and I ever took he looked at me and he said you know we've looked this is the first trip that the President of the World Bank and the U.S. Secretary General have ever made together I mean in 70 years ago it was the intention of the founders of these two institutions that we worked very closely together the first time in history that they would ever travel on the same mission together so we've done three we're going to do more and we hope to continue it because you know things like organizational identity which is what stopped this from happening before raising the flag or whatever is what stopped it and how ridiculous is that in the face of the conflicts we face thank you hashtag bottom 40 we can take two more questions can we take one from Niko? Niko Mumbria from Oxfam I quoted you guys so let's give Niko a chance Niko stand up so we know who you are there you go thank you so I'm Niko Mumbria I'm the head of the Oxfam International Office in DC so yeah the first thing I wanted to say thank you Jim for pointing out the problem of increasing income inequality and using our report we have another quote that the thing was also a lot in the news is that the one person reaches people has much wealth as the rest of us next year so it shows you how big the issue is also thanks for speaking so strongly against trickle-down economics I can tell you how long we've been waiting to hear the World Bank say that and the IMF like two months ago you rightly pointed out to the problem of companies not paying the taxis and using strategies not to do that in the poorest countries next week in Lima there will be a meeting of the finance ministers on the OECD BEPS process Jim you can probably explain it better than me but it's the process at the OECD trying to solve this issue there's been a lot of criticism from outside and many of the CSOs about this process saying yes, it brings solution but A, there was not inclusive there was only about rich countries B, it's not covering a lot of issues that are important for them I wanted to know what's your point of view on that what can you do with Christine Lagarde do you want to go ahead and take that it's a great point we've talked about this and I think the BEPS which is base erosion and profit shifting which really looks at the way that companies use things like transfer pricing taking all the profits in one country whereas in fact a lot of the work was done in another country and essentially minimizing their taxes by utilizing their multinational status these kinds of things first of all let me just say I think it's really important that OECD and Anhel Guria has taken this on it's a really important first step and I think especially the commentary that you've made about we've got to now extend this and include what's happening in developing countries for me personally I think that's a very valid part critique but part a sense of where the process has to go next and so next time I talk to Anhel we will talk about this and I think it's a really good next step to really see how becoming a multinational corporation if you can just sort of take your profits in the places that have the lowest taxes it just doesn't seem fair and this is what everyone's talking about so domestic resource mobilization as many of you know we put together a document with the other multilateral development banks in IMF called billions to trillions the amount available for the sustainable development goals. Domestic resource mobilization is one of them but the developing countries have been very clear about this they call it the illicit financial flows and it included in illicit financial flows in addition to you know to individuals just stealing money and taking it out you know and for that what they need is cooperation from banks in the developed countries to not hide those those large transfers but what they also talk about is corporations that don't pay any taxes in their country despite the fact that for example they may extract minerals from those countries and so this is now firmly on the agenda illicit financial flows is firmly on the agenda and could very well be the next step of what the OECD does two quick questions Kathleen and then Alex Good morning Kathleen Kienist my name is Kathleen Kienist and I'm the CEO of the OECD and formerly at the World Bank my question today is on the SDG number 5 gender equality I would be interested in what your recent data is saying about this important SDG and what you at the World Bank are doing with regards to gender equality okay and then let's just get from Alex Alex Theer from USA and I wanted to go back to Goal 16 because as you know going through the Addis Accord and financing for development and now these sustainable development goals the toughest part of our shared mission to end extreme poverty is going to be about dealing with the challenge in fragile and failed states and one of the things that that challenge is us to do is to figure out not only how we use more of the public resources but also how we get other actors private sector and others in two fragile states but there's a lot of risk involved in that and so we have to be creative about how we're going to do more to promote inclusive growth even in those hardest to reach places and I wonder if you can say more about what you're doing to achieve that right so on the issue of gender equality you know there's hardly any more no brainer than things like you know focusing on education for girls you know the other great thing you know I don't mean to pick on Korea but let me pick on Korea for a second right so you know on the one hand in order for them to succeed they're going to have to really be a destination of choice for skilled workers from other countries who feel that they're going to become part of Korea so they've got to get over if you will racism right the other thing they have to get over is sexism because it's the lowest female labor force of any OECD country so they've got to take steps of getting past sexism in the workforce right so I think we can say very clearly that if you want to compete economically you have got to focus on gender equality and bringing education for girls opportunities for girls and opportunities for women to participate in the workforce this is not easy you know Japan for example has made a declaration that they're going to do this but they have to change the fabric of society daycare centers have to change lots of things have to change but again we just feel so good that we can say that economic growth is about gender equality it really is about gender equality and I think that's going to be our most important role our most important role is going to be to continue to emphasize that we're not saying this just because it's the right thing to do which it is we're saying this because you're going to have to compete and you can't if you leave if you don't educate girls and you don't give opportunities for women so we as you know we have a cross cutting solutions area Karen ground who's worked at USAID is now leading the effort we have to do better we have to do a lot more for gender equality in places where talking about gender equality is tough but we'll do it Alex you know this is something that we're going to have to work a lot on together because look any extreme poverty by 2030 half of all people living in extreme poverty will be living in fragile and conflict of active states by 2020 so we are really rethinking what we do we know that we have to really move a lot of our investments into fragility and conflict we know that we have to it's not just about sort of basic services it's about stimulating the private sector I mean you cannot sort of leave things to later in these settings so it's our biggest challenge and yet it's our central challenge unless we're better at working in fragile and conflict affected states you know forget any possibility of reaching the end of extreme poverty goal absolutely so a final question for you to bring it home on is from Zubeda Nanfuka who says what do you say to the cynics who think that shared prosperity is an illusion well what I say to the cynics is what my good friend Tracy Cower excuse me Tracy who wrote a book about my close friend and colleague Paul Farmer said he you know he followed us around we were in the prisons of Siberia together we were in Haiti we were in the slums of Lima together and he just couldn't believe how optimistic we were all the time and he was a writer and he said you know I just looked at you guys and I thought you were so naive to be so optimistic all the time until I realized that cynicism is the last refuge of the coward and with that please join me in thanking Dr. Jim Kim thank you everybody ladies and gentlemen please take your seats until the official party departs