The World Bank Rediscovers Industrial Policy - and Highlights Quality Infrastructure as a Key Area

After decades of scepticism, the World Bank has fundamentally revised its stance on industrial policy. For those of us working in quality infrastructure and systemic competitiveness, the implications are significant and encouraging.

For decades, the World Bank was among the most consistent institutional opponents of industrial policy. Its prescriptions, rooted in the Washington Consensus, emphasised macroeconomic stability, liberalisation, and, above all else, getting prices right. Targeted state interventions to shape industrial structure were, at best, regarded with suspicion.

That position has now shifted. In a newly published report (Fernandes & Reed, 2026), the World Bank undertakes a fundamental revision of its stance on industrial policy and acknowledges, albeit with some reservations, that the changed economic reality of the 21st century demands more than macroeconomic stability alone. For emerging and developing countries in particular, a focus on stability is no longer sufficient to achieve sustainable development.

A Welcome, if Overdue, Change of Heart

At Mesopartner, we welcome this change of heart wholeheartedly. The approach to systemic competitiveness that we have promoted for many years emerged precisely in the 1990s as a critique of the Washington Consensus (Meyer-Stamer et al., 1996). We have long argued that targeted, often sector-focused interventions by meso-level institutions, such as business associations, technology centres, standards bodies, or training providers, represent important complementary areas of action that macroeconomic policy alone cannot substitute for.

The World Bank’s updated position affirms what development practitioners have observed on the ground for decades: markets do not automatically generate the institutional infrastructure needed for sustained structural transformation, and that deliberate policy choices about which capabilities to build, and how, are unavoidable.

Quality Infrastructure as a Central Instrument

Perhaps the most striking aspect of the report, and certainly the most immediately relevant to this community, is its treatment of quality infrastructure (QI) as a central instrument of industrial policy. This is not a marginal footnote; the report explicitly situates QI within the broader industrial policy toolkit, alongside more traditional instruments such as subsidies, trade policy, and public investment.

This is consistent with the direction the World Bank has been moving. Its World Development Report 2025, published under the title Standards for Development, already emphasised the importance of QI for countries’ development trajectories (Harmes-Liedtke et al., 2025; World Bank Group, 2025). The industrial policy report now reinforces and extends that message: QI is not a niche technical concern but a strategic policy priority.

Three Practices of Successful Quality Infrastructure

The QI section in the report was authored by Juan Carlos Hallak, a colleague with notable practical and academic credentials. As former Secretary of State and head of Plan Calidad Argentina, he strengthened QIas part of the national government’s effort to boost export competitiveness (Hallak & Gutman, 2025). His contribution distils the experience of successful QI systems into three key practices:

1. Define a clear strategic vision and provide the resources necessary for its implementation; QI cannot succeed as an afterthought.

2. Establish independent agencies for standardisation, metrology, and accreditation; institutional independence is foundational to credibility and effectiveness.

3. Build QI as a public-private partnership system; the sustained engagement of industry is not optional, but constitutive of the system’s purpose.

The GQII: Measuring What Matters

The report also makes use of the Global Quality Infrastructure Index (GQII) as an instrument to comparequality infrastructure between countries and identify correlations with broader economic indicators (Harmes-Liedtke et al., 2026). The findings confirm what many in the QI community have long argued empirically: countries with higher per capita income tend to have stronger quality infrastructure systems.

The GQII features in both World Bank publications signal growing recognition of QI as a measurable, comparable, and policy-relevant dimension of a country’s economic endowment, not simply a technical compliance matter.

QI as Part of a Broader Policy Commitment

The most important conceptual move in the report is, from our perspective, the framing of QI as part of a broader industrial policy commitment, not as an end in itself. This distinction matters enormously for how QI systems are designed, funded, and evaluated.

Too often, national QI systems develop in relative isolation from wider economic strategy. Standards bodies, accreditation councils, and metrology institutes operate according to their own internal logics and international obligations, without systematic connection to questions of structural transformation, export diversification, or technological upgrading. The World Bank’s framing invites and implicitly challenges those responsible for QI to ask: which industrial priorities are we serving, and how?

For development cooperation practitioners, the report offers useful conceptual grounding for a message that Mesopartner and others have been making for years: that investing in the meso-level institutional architecture of an economy. including in quality infrastructure institutions, is not a soft or secondary priority. It is a precondition for the structural transformation that macroeconomic stability alone cannot deliver.

The World Bank’s shift in position is ultimately an invitation to a richer conversation about what development policy can and should do. We look forward to continuing this conversation.

References:

Fernandes, A. M., & Reed, T. (2026). Industrial policy for development: Approaches in the 21st century. World Bank, (Policy Research Reports). https://doi.org/10.1596/978-1-4648-2276-6

Gutman, M., Hallak, J. C.(2025). The Creation and Consolidation of the Argentine Quality Plan. Serie Documentos de Trabajo del IIEP, 108, 1-24.

Harmes-Liedtke, U., Muñoz, M., Waltos, E., Ramkissoon, A.-S., & Schoen, C. (2026). Insights and trends on economies using metrology, standards, accreditation and conformity assessment services (GQII Data & Analytics Paper No. 7). Mesoparter

Harmes-Liedtke, U., Ramkissoon, A.-S., Schoen, C., & Grinsted, P. (2025). The Evolution of Quality Infrastructure: Experiences and Prospects of Advanced Economies and Developing Countries (WDR 2025 Background Papers)

Meyer-Stamer, J./ Hillebrand, W./ Eßer, K/ Messner, Dr.  (1996). Systemic Competitiveness: New Governance Patterns for Industrial Development, GDI, Berlin

World Bank. (2025). World Development Report 2025: Standards for development. World Bank.