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PRESS RELEASE

World Bank to Disburse US$55 Million to Help Haiti Meet Urgent Financing for Reconstruction

August 17, 2010




WASHINGTON, August 17, 2010 - The World Bank announced today that it will disburse US$55 million to Haiti which will help the Caribbean nation address some of its most urgent financing needs as it strives to recover in the wake of the January 12th earthquake that killed more than 230,000 people and caused widespread destruction mainly in the capital, Port-au-Prince. The disbursement will take place once the Government of Haiti finalizes the legal documents for the grants, which were signed in the Haitian capital on Tuesday of last week.
 
The US$55 million provided to Haiti include a US$30 million grant from the World Bank’s International Development Association (IDA), approved by the Board of Directors on August 5th, with an additional co-financing of US$25 million from the Haiti Reconstruction Fund (HRF), managed by the Bank and to which Brazil, Norway, Australia, Colombia and Estonia have contributed.
 
The World Bank is taking quick and decisive steps to ensure that resources are delivered to Haiti, where the needs are still great,” said World Bank Vice President for Latin America and the Caribbean Pamela Cox. “Making funds available so government can pay for key short term reconstruction expenditures is important, but to step up reconstruction, donors need to deliver as soon as possible on the pledges they made in New York earlier this year.”
 
The funds will help Haiti meet urgent financing needs for reconstruction, which have been exacerbated by revenue shortfalls following the earthquake. Damages and losses caused by the earthquake are estimated at nearly US$8 billion by the Post Disaster Needs Assessment (PDNA) carried out in February 2010. The destruction of the Tax Directorate and the impact of the earthquake on economic activities have caused a 20 percent drop in projected revenue for fiscal year 2009-2010. The IDA and HRF grants provide resources to finance essential expenditures in the last quarter of 2010 in the context of the Action Plan for National Recovery and Development presented by Government to the international community in March 2010.
 
In addition, these grants will help the Government of Haiti maintain and strengthen the economic governance reforms started before the earthquake and will support Government’s post earthquake program for enhancing transparency and accountability. This is particularly important in view of the increased flow of funds to Haiti for supporting reconstruction.
 
BACKGROUND
 
World Bank Support to Haiti

To help Haiti recover from the January 12 earthquake, the World Bank Group has pledged US$479 million through June 2011. All World Bank funding has been in grant form since mid-2005. Of the total pledged amount, more than half has already been made available to Haiti:

  • US$107 million in new resources from the International Development Agency (IDA) and trust funds have been approved to support reconstruction and development projects;
  • US$55.5 million from IDA have been spent in support of social and emergency reconstruction needs since January 2010; and US$42.5 million provided in budget support;
  • US$39 million, Haiti’s full debt to the World Bank, have been cancelled; and
  • US$49 million have been made available by the Bank Group’s private sector arm, the International Finance Corporation (IFC), to support Haiti’s private sector, which has also disbursed US$7.6 million since the earthquake.

Some of the results achieved in Haiti to date with World Bank Group support include:

  • Offices were acquired and equipped for the Ministry of Economy and Finance and Tax Office (over 500 staff), enabling the Ministry to function and revenues to be collected.
  • More than 200,000 buildings have been assessed for structural damage.
  • Around 90,000 cubic meters of trash and debris were removed from key drainage canals in Port-au-Prince, reducing flood risk for temporary camps in the capital.
  • 50,000 solar lanterns were purchased and distributed, increasing safety and reducing fire hazard and benefiting more than 200,000 people.
  • A transfer of US$3 million to the World Food Program has helped provide supplementary food to 200,000 children aged 6-23 months, while US$1 million to the Pan-American Health Organization has supported basic health care services to pregnant and lactating women and children from 0-24 months.
  • 140,000 children are being funded to attend school, and 50,000 children in more than 1,200 schools are receiving a hot meal every day.
  • Six water supply systems were completed, benefiting 37,000 people in rural communities in the South, which are struggling to absorb the exodus from the capital.
  • IFC completed the structuring of the international bidding process for TELECO, which is bringing the country’s largest foreign direct investment since the earthquake—a US$100 million investment by Vietnam’s biggest mobile telephone operator, Viettel, to expand telecommunications services in Haiti.

Haiti Reconstruction Fund

At the request of the Government of Haiti, the World Bank established the Haiti Reconstruction Fund (HRF) in March 2010, in partnership with the Inter-American Development Bank and the United Nations. Donors pledged about US$500 million to the HRF in March. To date, five donors have confirmed their pledges for a total of US$99 million, of which US$67 million have been received.

The HRF is one of several sources of post-earthquake reconstruction financing. The bulk of the resources pledged to Haiti at the March 31 donor conference (US$5.3 billion) will likely flow through bilateral donors and NGOs, and not through the HRF.

Media Contacts
In Washington
Ana Elisa Luna
Tel : (202) 473-2907
alunabarros@worldbank.org
Patricia da Camara
Tel : (202) 473-4019
pdacamara@worldbank.org


PRESS RELEASE NO:
2011/067/LAC

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