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World Banks Policy Manual Dealing with De facto goverments
- These policies were prepared for use by World Bank staff
These policies were prepared for use by World Bank staff
and are not necessarily a complete treatment of the subject.
Dealings with De Facto Governments
Note:This OP 7.30 replaces OP 7.30, dated November 1994. Questions may be addressed to the Chief Counsel, Operations Policy.
1. A "de facto government" comes into, or remains in, power by means not provided for in the country's constitution, such as a coup d'état, revolution, usurpation, abrogation or suspension of the constitution.
2. A decision to make a loan1 to, or to have a loan guaranteed by, a country with a de facto government, or to continue disbursing under existing loans to or guaranteed by such country, or to provide a guarantee in respect of a project in the territories of such country,2 does not in any sense constitute Bank "approval" of the government, nor does refusal indicate "disapproval". The Bank under its Articles is required to refrain from interfering in the political affairs of any member; moreover, its decisions may not be influenced by the political character of the member country concerned.3
3. In many cases, a de facto government either suspends the constitution or abrogates it. In other instances, the constitution and other basic laws remain partially or wholly in force. In either situation, the Bank when continuing disbursements under an existing loan or making a new loan or issuing a guarantee ascertains that (a) a proper legal framework exists to secure approval of the Bank loan or the Bank guarantee and the related counter-guarantee of the country, to permit the project to be carried out, to allow the project objectives to be achieved and to allow the loan to be repaid or any required payments under the country's counter-guarantee of the Bank guarantee to be made; and (b) all parties to the agreements with the Bank in respect of the project have taken or will be able to take all actions necessary to carry out their respective obligations under their respective agreements with the Bank. The Bank also ascertains that these obligations are or will be valid and binding.4