Supporting the New Deal and g7+ fragile countries
Addressing poverty and development in fragile and conflict-affected states is fundamental to delivering on the World Bank Group goal to end extreme poverty by 2030. The World Development Report 2011: Conflict, Security and Development called for a paradigm shift in the development community’s approach to fragile and conflict-affected situations (FCS), based on the premise that violence and other challenges cannot be resolved by short-term or partial solutions in the absence of institutions that provide people with security, justice, and jobs.
Now, more than three years after the new the New Deal was drawn up in Busan in 2011, articulating a new vision to support peace-and state-building goals, 34 countries and six international organizations have endorsed the framework as of April 2014. The New Deal sets peace and state building as essential prerequisites for achieving the MDGs and commits those who sign up to transparency, risk sharing, use of country systems, strengthening of capacities, and timely and predictable aid. Among countries which have endorsed this approach are both industrialized donor countries and fragile and conflict-affected countries, some of them in conflict currently. The fragile countries also manage their own collective voice through the organization of the g7+.
The World Bank Group President meets regularly with the g7+ addressing issues of capacity building, making extractive industries work for poor people and how best to support states when they fall into crises as with the recent cases of Central African Republic and South Sudan. In both these cases the World Bank Group has pledged to remain engaged reflecting the important New Deal principle of predictable aid flows and consistent engagement.
Fostering private sector growth
Recognizing that countries cannot escape from fragility without a vibrant economy, and that the private sector creates 90% of jobs in developing countries, the World Bank Group is also strengthening its work in developing the private sectors of FCS.
As part of this, IFC is stepping up its efforts to remove the constraints to business growth by providing access to energy, access to finance, and access to markets. It has committed to increasing private sector investment in FCS, including through a 50% increase of its own-account investment volume between FY12 and FY16. Furthermore, IFC is working with the g7+ members to find ways to increase private investment to their countries.
Beyond IFC, the World Bank Group is promoting private sector growth in FCS in ways such as creating an enabling environment for business and developing key financial infrastructure. MIGA plays a key role in the WBG’s efforts to foster private sector growth in FCS, with 29% of projects supported by MIGA in fragile or conflict-affected countries during the past fiscal year. MIGA has also launched its Conflict-Affected and Fragile Economies Facility that will use donor contributions together with MIGA guarantees to support significant projects in these countries.
Working with the United Nations
The UN-World Bank Fragility and Conflict Partnership Trust Fund has supported a number of new initiatives over the past year, utilizing resources to strengthen the impact of the collective engagement in FCS. UN and WBG teams worked closely to facilitate follow-up action from the visits of the UNSG and President Kim to the Great Lakes and Sahel regions, as well as new partnership work in Jordan, Yemen, and South Sudan.
The past year has seen a significant surge in interest to the fund which has supported a baseline study to understand and response to Gender Based Violence in Somalia, through a joint baseline study in all three regions; support to the African Union and regional partners to respond to demobilization, disarmament and reintegration challenges across Africa; and, policies and programs addressing the role of youth as peacebuilders in FCS.
Gearing up at the World Bank Group
Given the development imperative inherent in the numbers of people around the world and in all regions affected by conflict and violence, the WBG has strongly advocated for greater attention to FCS resulting in a commitment to raise the IDA share of resources to fragile countries by about 50 percent over the next three years helping them to move towards stability and equitable livelihoods for their citizens. The WBG’s specialized conflict unit, the Fragility, Conflict and Violence (FCV) group, co-located between Washington DC and Nairobi, is also deepening its work in areas of particular concern in FCS like the equitable use of extractive industry proceeds especially as at least 80 percent of countries considered fragile are endowed with rich mineral and carbon wealth. Equally important is the challenge of job creation as many FCS have large populations of young people and a European Union supported trust fund will help the World Bank Group expand efforts to address this. A further area of close attention is support to institution building so that good governance can become a cornerstone of emerging state structures and citizens may begin to trust their state.
As part of its strategy support to countries grappling with conflict, the FCV group has recently worked in the Great Lakes Region, the Sahel and the Horn of Africa as well as countries outside the sub-Saharan Africa region such as Yemen, Syria, the Pacific Islands and Myanmar. Research into the role of conflict is ongoing on regions like the Sahara, West Africa and the Horn of Africa to help the World Bank Group better understand the regional context of fragility, conflict and violence.