World Bank Commits $75 Billion for Globe’s Poorest CountriesBy
Development lender will issue about $25 billion in debt
47 nations to contribute another third of the total funding
The World Bank pledged $75 billion over three years to the world’s poorest countries as part of a refinancing plan that will see it issue about $25 billion of debt in capital markets.
Donor countries will contribute about another third of the funding, while the rest will come through money provided by the private sector, World Bank Vice President Axel van Trotsenburg told reporters Thursday on a conference call.
The $75 billion will replenish the International Development Association, which lends to low-income countries on concessional terms. The cash will be available between July 1, 2017 and the end of June 2020, the World Bank said Thursday in a press release.
“The strong and enthusiastic support for IDA comes despite the tight budget environment faced by many of our donors,” said World Bank Interim Managing Director Kyle Peters.
The World Bank announced in September that IDA had obtained a top-notch AAA credit rating and would tap financial markets for the first time, to fund grants and low- and no-interest loans to the poorest nations. The bank aims to reduce the proportion of those living in extreme poverty to no more than 3 percent of the world’s population by 2030.
Since its creation in 1960, IDA has been largely financed through contributions from rich countries, with the Group of Seven accounting for roughly two-thirds. The World Bank’s other lending arms, which typically offer loans at market rates, also support IDA’s budget.
The World Bank declined to identify the 47 donor countries or break down the amounts by country. The bank secured $52 billion in donor financing the last time IDA was replenished, in 2013.
IDA made $16.2 billion in financial commitments in the year through the end of June, down from $19 billion the year before.