The World Bank’s concessional loan affiliate, the International Development Association (IDA), will commit an additional US$3.8 billion over the next five years to the world’s poorest countries. The FY1989 IDA lending program of SDR 3.6 billion (about US$4.6 billion) will be increased by SDR 525 million (about US$ 650 million).
Ernest Stern, Senior Vice President (Finance), at a press briefing here said the additional commitment is based on repayments of earlier IDA credits and lauded the outstanding payment record of developing member countries. The additional commitments will help finance urgently needed projects, particularly for poverty alleviation, food security and environmental protection. These commitments, generated by the developing countries themselves, are in addition to the contributions made by the major industrial nations through the regular triennial replenishment of IDA funds.
Included is a special assistance program for IDA-only countries with outstanding debt to the World Bank, incurred when they were creditworthy. As their creditworthiness declined, they ceased to be eligible for IBRD lending and became IDA-only countries.
Eligible countries will receive a supplement to their adjustment credits. To be eligible, a country must have an effective adjustment program and be current in its payments to the Bank. Funds or this special program, amounting to US$420 million over the next five years, will be allocated in proportion to interest due from such countries to the IBRD. Countries expected to benefit from this program in the current year are: Bangladesh, Bolivia, Ghana, Kenya, Madagascar, Malawi, Senegal, Sri Lanka, Tanzania, Togo and Uganda.