WASHINGTON, September 14, 2017 — The World Bank today approved a $600 million International Development Association (IDA)* grant to support the Government of Ethiopia’s vision of building a national safety net system to provide effective support in chronically food insecure rural areas, including providing cover during droughts.
The Rural Productive Safety Net Project (RPSNP) supports the evolution of the Government’s umbrella Productive Safety Net Program (PSNP) that has been in operation for the last 12 years and is one of the world’s largest safety net programs in the world. Run by the Government, the PSNP pools money from 11 donors, including $600 million of World Bank Group IDA funds. The PSNP provides regular cash or food transfers to 8 million people; currently 4 million of them are in areas affected by the ongoing drought. Its food-for-work component supports public works programs related to landscape restoration, irrigation, and agro-forestry.
“RPSNP will help Ethiopia to provide predictable safety net support to 8 million chronically food insecure people in persistently food insecure rural areas,” said Carolyn Turk, World Bank Country Director for Ethiopia Sudan and South Sudan. “The project sets a very good example of how in practice development and humanitarian efforts can be combined to better respond to the needs of the poor and most vulnerable.”
The program has demonstrated that safety nets – when provided in a predictable, regular manner – can protect households from the negative impacts of shocks. Studies have shown that PSNP clients are more resilient to droughts and have the capacity to bounce back twice as fast as households outside of the program. Distress sale of assets, common during droughts, went down from 54 percent in 2010 to 26 percent in 2014. The public works component has added benefits for communities, for example turning 1.2 million hectares into productive land with soil and water conservation activities.
The RPSNP helps the Government shift from humanitarian response to a predictable safety net system. The RPSNP integrates the PSNP and the humanitarian food aid, which during the El Niño-induced drought reached 10.2 million people, under a common operational framework to better manage the selection, administration, and payments to beneficiaries. The project will thereby contribute to improving the equity, efficiency and transparency of the safety net system.
The RPSNP approved today is firmly aligned with the World Bank Group’s new Country Partnership Framework for Ethiopia and its twin goals of ending extreme poverty and promoting shared prosperity. RPSNP will support the Government to build the systems for a national safety net program and is supporting implementation in eight regions: Afar, Amhara, Dire Dawa, Harari, Oromiya, Somali, Southern Nations, Nationalities, and Peoples (SNNP) Region, and Tigray.
“The RPSNP applies the lessons learned under the PSNP including from the response to the El Niño-induced drought and supports the government’s vision to put in place a national safety net system that is fully independent of outside funding by 2025,” said Sarah Coll Black, World Bank Task Team Leader for the Project.
In addition to the Government of Ethiopia’s increasing contribution, the program will be financed by 10 Development Partners, including the World Bank Group. These partners are the Canadian Government, Danish International Development Assistance, the Kingdom of the Netherlands, the European Union, Government of Ireland, the Department for International Development, United Nation’s Children Fund, United States Agency for International Development, and the World Food Program.
* The World Bank’s International Development Association (IDA), established in 1960, helps the world’s poorest countries by providing zero-interest loans and grants for projects and programs that boost economic growth, reduce poverty, and improve poor people’s lives. IDA is one of the largest sources of assistance for the world’s 82 poorest countries, 40 of which are in Africa. Resources from IDA bring positive change for 2.5 billion people living on less than $2 a day. Since 1960, IDA has supported development work in 108 countries. Annual commitments have increased steadily and averaged about $16 billion over the last three years, with about 50 percent of commitments going to Africa