World Bank wins pledges for US$100 billion replenishment of fund for poorest countries
A participant stands near a logo of World Bank at the International Monetary Fund - World Bank Annual Meeting 2018 in Nusa Dua, Bali, Indonesia, on Oct 12, 2018. (Photo: REUTERS/Johannes P Christo)
WASHINGTON: Donor countries have pledged a record US$100 billion three-year replenishment of the World Bank's fund for the poorest nations, providing a vital lifeline for their struggles against crushing debts, climate disasters, inflation and conflict.
The World Bank made the announcement early on Friday (Dec 6) in Seoul at a pledging conference for the International Development Association, which provides grants and very low interest loans to some 78 low-income countries.
The total exceeds the previous US$93 billion IDA replenishment announced in December 2021. Countries will contribute about US$24 billion directly to IDA, but the fund will issue bonds and employ other financial leverage to stretch that to the targeted US$100 billion in grants and loans through mid 2028.
But the two-day pledging conference fell short of the US$120 billion goal that some developing countries had called for, partly because the dollar's strength - pushed up by Donald Trump's US presidential election victory - diminished the dollar value of significant increases in foreign currency contributions by several countries.
At a G20 leaders' summit in Brazil last month, Norway increased its pledge by 50 per cent from 2021 to 5.024 billion krone. That's US$455 million at current exchange rates, but at the start of 2024, it would have been worth US$496 million.
South Korea boosted its pledge by 45 per cent to 846 billion won, (US$597 billion), Britain by 40 per cent to £1.8 billion, while Spain boosted its contribution to €400 million, a pledge worth US$423 million - US$10 million less than the day it was announced in October.
US President Joe Biden pledged a US$4 billion US contribution, up from US$3.5 billion in the previous round.
