The World Bank on Thursday announced that the global community has stepped up with a $93 billion support package to boost resilient recovery in the world’s poorest countries.
The bank explained that the replenishment package of the International Development Association (IDA) is to help low-income countries respond to the COVID-19 crisis and build a greener, more resilient and inclusive future.
Africa will receive about 70 per cent of the funding, and “with this strong package, IDA will be able to scale up its support in the pandemic and address health challenges, helping 400 million people receive essential health and nutrition resources. The social safety nets programme is also expected to reach as many as 375 million people”, the Bank stated.
According to the Bank, the financing brings together $23.5 billion of contributions from 48 high- and middle-income countries with financing raised in the capital markets, repayments, and the World Bank’s own contributions.
It pointed out that the financing package, agreed over a two-day meeting hosted virtually by Japan, is the largest ever mobilised in IDA’s 61-year history, and stressed that IDA’s unique leveraging model enables it to achieve greater value from donor resources – every $1 that donors contribute to IDA is now leveraged into almost $4 of financial support for the poorest countries.
In his reaction, the World Bank Group President, David Malpass said: “Today’s generous commitment by our partners is a critical step toward supporting poor countries in their efforts to recover from the COVID-19 crisis.
“We are grateful for the confidence our partners have in IDA as a non-fragmented and efficient platform to tackle development challenges and improve the lives of millions of people around the world.”
He said the funds will be delivered to the world’s 74 poorest countries under the 20th replenishment (IDA20) programme, which focuses on helping countries recover from the impacts of the COVID-19 crisis.
The Bank noted that in these countries, the ongoing pandemic is worsening poverty, undermining growth, and jeopardizing the prospects of a resilient and inclusive development.
“Countries are struggling with falling government revenues; increasing debt vulnerabilities; rising risks to fragility, conflict, and instability; and dropping literacy rates. About a third of IDA countries are facing a looming food crisis”, the World Bank said.
To help countries build back greener, it further stated that a substantial portion of these funds will go to tackling climate change, with a focus on helping countries to adapt to rising climate impacts and preserve biodiversity.
“IDA will also deepen support to countries to better prepare for future crises, including pandemics, financial shocks, and natural hazards.
“While IDA20 will support countries globally, resources are increasingly benefiting Africa, which will receive about 70 percent of the funding.
The IDA20 programme has more ambitious policy commitments that will support countries in prioritizing investments in human capital, covering issues such as education, health and nutrition, vaccines, safety nets, and support for people with disabilities.
It added that “IDA will also increase its ambition in addressing other major development challenges such as gender inequality, job creation, and situations of fragility, conflict and violence, including in the Sahel, the Lake Chad region, and the Horn of Africa.
“A continued emphasis on governance and institutions, debt sustainability, and digital infrastructure interventions will help foster economic and social inclusion”.
The World Bank further explained that due to the urgent development needs of IDA countries, the replenishment was advanced by one year, and that IDA20 will cover the period of July 1, 2022, to June 30, 2025.
The IDA20 policy architecture builds on the strong foundation of IDA19, with enhancements to make IDA20 even more ambitious and fit for today’s challenges.
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