World Bank Announces $100 Billion Support for Poorest Countries
The World Bank announced on Thursday that it has raised nearly $24 billion in funding to provide loans and grants for the world’s poorest nations, leveraging this to generate a record $100 billion in total spending power. This amount is significantly higher than the previous $93 billion from the 2021 fundraising round.
Donor countries contributed $23.7 billion to the International Development Association (IDA), the World Bank’s concessional lending arm. This represents a modest increase from the approximately $23.5 billion pledged during the last fundraising round three years ago. The IDA can use this contribution to borrow additional funds from financial markets, boosting the total spending capacity by a factor of four.
This funding will provide crucial support for the 78 poorest countries globally, addressing pressing challenges such as the economic fallout from the COVID-19 pandemic, climate change adaptation, and other developmental needs. The IDA’s programs are designed to assist countries that have limited access to financial markets, offering grants and concessional loans to fund initiatives that foster economic growth and improve living conditions.
The World Bank hailed the success of the IDA21 replenishment as a “historic” achievement, emphasizing that it is a vote of confidence from donors and clients. The World Bank also stated that it reflects their ongoing efforts to become a faster, simpler, and more effective institution in addressing global poverty and development challenges.
This announcement comes after two days of discussions in Seoul, South Korea, where World Bank officials and donor representatives gathered. The decision to announce the funding increase followed significant political tensions in the country, including President Yoon Suk Yeol’s brief declaration of martial law, which was later reversed under pressure from lawmakers.
The record $100 billion in funding underscores the World Bank’s commitment to supporting the world’s poorest nations as they navigate the long-term impacts of the pandemic, mitigate the effects of climate change, and work towards sustainable development goals. This funding initiative highlights the global recognition of the need to invest in the most vulnerable economies for a more resilient future.
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