World Bank moves to aid Caribbean COVID-19 recovery
The World Bank has launched an early replenishment process of the International Development Association (IDA) to support Caribbean and other countries in their recovery from the COVID-19 crisis, and transition to “green, resilient and inclusive development”.
The Washington-based financial institution said the IDA20 replenishment will conclude in December 2021 with a policy and financial package to support 74 countries between July 2022 and June 2025.
“IDA accelerated its financing commitments in 2020 to help the world’s poorest countries contain the impacts of the pandemic and lay the groundwork for recovery. I am pleased that our shareholders have agreed to an early replenishment so IDA can continue these efforts,” said World Bank Group President David Malpass.
“IDA is a uniquely effective platform, consolidating global resources from donors and capital markets to support well-focused country programmes and development spending,” he said, adding “an ambitious and successful IDA20 replenishment by December 2021 will be critical to provide the concessional financing and grants that the poorest countries need so urgently at this time”.
The World Bank said the IDA19 three-year cycle started in July 2020, with US$23.5 billion of donor contributions aiming to enable a total of US$82 billion financing to IDA countries.
Almost half of this amount has been committed to the world’s poorest countries in the first year of the IDA19 cycle, “necessitating advancing IDA20 so that additional financial resources can be available for countries to meet their urgent development needs,” the bank said.
In February 2021, it said IDA donor and borrower country representatives agreed to advance IDA20 by one year due to pressures of the COVID-19 crisis.
Under the theme, ‘Building Back Better from the Crisis: Towards a Green, Resilient and Inclusive Future’, the World Bank said the IDA20 replenishment process will be informed by IDA19 progress, as well as the bank’s mission and COVID-19 response.
The World Bank said the IDA donor and borrower representatives agreed that the IDA20 policy framework will maintain the four IDA19 special themes of climate change; fragility, conflict and violence; gender; and jobs and economic transformation.
It said human capital will be introduced as the fifth special theme and that IDA20 will also deepen recovery efforts by focusing on four cross-cutting issues: crisis preparedness; debt sustainability and transparency; governance and institutions; and technology.
The World Bank said negotiations on the policy commitments and financing framework will continue through meetings in June and October, concluding with donors pledging their contributions on December 13-14, 2021.
The financial institution said IDA is one of the largest sources of funding for fighting extreme poverty in the world’s poorest countries, including some in the Caribbean.
“IDA provides zero or low-interest loans and grants to countries for projects and programmes that boost economic growth, build resilience and improve the lives of poor people around the world”.
Since 1960, it said IDA has provided about US$422 billion for investments in 114 countries.
“As an institution of the World Bank Group, IDA combines global expertise with an exclusive focus on reducing poverty and boosting prosperity in the world’s poorest countries,” the statement said.