The funding will enable
IDA to dramatically scale up development interventions to tackle conflict,
fragility and violence, forced displacement, climate change, and gender
inequality; and promote governance and institution building, as well as jobs
and economic transformation areas of special focus over the next three years.
These efforts are
underpinned by an overarching commitment to invest in growth, resilience and
opportunity.
“This is a pivotal step in the
movement to end extreme poverty,” World Bank Group President Jim Yong Kim said. “The commitments made by our partners, combined with
IDAs innovations to crowd in the private sector and raise funds from capital
markets, will transform the development trajectory of the world’s poorest
countries. We are grateful for our partners trust in IDAs ability to deliver
results”.
With
this innovative package, the world’s poorest countries especially the most
fragile and vulnerable will get the support they need to grow, create
opportunities for people, and make themselves more resilient to shocks and
crises, said Kyle Peters, World Bank Group Interim
Managing Director and Co-Chair of the IDA18 negotiations. IDAs focus on issues like climate change,
gender equality and preventing conflict and violence will also contribute to
greater stability and progress around the world."
IDA is active in 39
countries in Africa, where it is the single largest source of donor funds for
basic social services. From FY06-16, IDA provided $83 billion in financing for
more than 1,000 projects in Sub-Saharan Africa. Of this, more than $18 billion
was invested in the development of institutions. Nearly $13 billion supported
the provision of critical health and social services. In FY16, the World Bank
approved $8.7 billion for the region.
Financing during the
IDA18 replenishment period, which runs from July 1, 2017 to June 30, 2020, is
expected to support: Essential health and nutrition services for up to
400 million people; Access
to improved water sources for up to 45 million people; Financial services for
4-6 million people; Safe childbirth for up to
11 million women through provision of skilled health personnel; Training for
9-10 million teachers to benefit 300+ million children; Immunizations for
130-180 million children; Better governance in 30 countries through improved
statistical capacity; and an additional 5 GW of renewable energy generation
capacity.
To finance this groundbreaking
package, IDA is proposing the most radical transformation in its 56-year
history. For the first time, IDA is seeking to leverage its equity by blending
donor contributions with internal resources and funds raised through debt
markets. By blending concessional contributions
from donors with its own resources and capital market debt, IDA will
significantly increase the financial support it provides to clients.
The
innovative financing package offers exceptional value for money, with every $1
in partner contributions generating about $3 in spending authority, said Axel van Trotsenburg, World Bank Vice President for Development Finance. It is one of the
most concrete and significant proposals to date on the Addis Ababa Action
Agendacritical to achieving the 2030 Sustainable
Development Goals.
The additional financing
will enable IDA to double the resources to address fragility, conflict and
violence (more than $14 billion), as well as the root causes of these risks
before they escalate, and additional financing for refugees and their host
communities ($2 billion). Increased financing will help strengthen IDAs support
for crisis preparedness and response, pandemic preparedness, disaster risk
management, small states and regional integration.
Efforts to stimulate
private sector development in the most difficult environments, at the core of
job creation and economic transformation, will receive a major push in the form
of a new $2.5 billion Private Sector Window (PSW). The PSW, being introduced
together with the International Finance Corporation (IFC) and Multilateral
Investment Guarantee Agency (MIGA), will help mobilize private capital and
scale up private sector development in the poorest countries, particularly in
fragile situations.
The funds will also help
governments strengthen institutions, mobilize resources needed to deliver
services, and promote accountability. A total of 48 countries pledged resources to
IDA; additional countries are expected to pledge in the near-term. The World Bank
Group is continuing the tradition of contributing its own resources to the
fund.
One
of the extraordinary things about IDA is that it brings different countries
together to help the poorest. In this replenishment in particular, weve really
seen that IDA is truly a global coalition, said van Trotsenburg.
A total of 75 low-income
countries are eligible to benefit from the IDA18 financing package.
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