- 1.8 Million Colombians will have improved urban transportation
- 1.2 Million children will have better access to early education
- Strategy seeks to help to reduce the fiscal deficit to 3.2 percent in two years
- Promotes low-carbon development
WASHINGTON, July 21, 2011 – The World Bank Group (WBG) today endorsed its new Partnership Strategy for Colombia, which will help the South American country consolidate economic reforms and improve results in infrastructure development and the social sectors, with the aim of aligning itself more closely to the standards of the Organization for Economic Cooperation and Development (OECD).
This partnership will benefit 1.5 million people who will see their quality of life improve after merging two key anti-poverty programs, and 1.2 million vulnerable children which will be able to access early education programs in 2014. It will also contribute to the formulation of a national policy for the promotion of low-carbon development.
The World Bank Group’s Board of Directors also approved three operations, totaling US$654 million, which focus on the Partnership’s three key issues: inclusive economic growth, fiscal sustainability, transportation and the environment.
“We welcome that the Country Partnership Strategy for Colombia is aligned with the government priorities set out in our “National Development Plan 2010 – 2014 Prosperity for all”. It is fundamental for our country to benefit from World Bank technical assistance and consulting services. This will allow us to improve speed governmental responses and improve public policy formulation”, said Hernando José Gómez, Director of the National Planning Department.
The new Country Partnership Strategy (CPS), which covers the period from July 2011 to June 2016, is based on an enhanced approach that prioritizes the achievement of results, in close alignment with Colombia’s National Development Plan. To that end it incorporates a service package (including financial, analytic and technical assistance services, among others) that leaves behind the traditional project-based approach in order to contribute –in a more selective and efficient way– to the government’s efforts to reach a more equitable and just society.
These activities form part of a comprehensive package of services centered around three strategic themes:
- Expanding opportunities for social prosperity via enhancements in social promotion, education access and quality, improvements of performance of social services and citizen security.
- Promoting sustainable growth with greater climate change resilience, through improvements in urban development, enhanced disaster risk management, and improved environmental management.
- Encouraging inclusive growth with greater productivity, through a better management of fiscal, financial and social risks, greater public sector efficiency, and improved productivity and innovation.
“Traditionally, the Bank used to lend financial resources for projects or to undertake studies on specific issues. Today, we have learned that the needs of a medium-income country like Colombia demand a greater integration of these services with others derived from the World Bank’s global experience that are capable of creating greater added value. The goal is to maximize our capacity to provide solutions that meet demands,” said Gloria Grandolini, WB Director for Colombia and Mexico.
This innovative partnership strategy has several advantages:
- Comprehensive – Makes available the full menu of products derived from the Bank Group’s main business lines, including Financial Services, Knowledge Services, and Coordination and Convening Services. The latter seeks to bring together experts from several fields and organizations at a global level to take advantage of the latest knowledge.
- Selective – Selects those issues and areas where the WB provides the greatest value added and is able to contribute to the maximization of results. This is the case with the Familias en Acción social protection plan and the issue of sustainable urban transportation.
- Flexible – Offers tailored solutions meeting Colombia’s needs. For example, in response to the recent flooding tragedy the Bank is putting into practice a second stand-by disaster loan destined to improve disaster risk management.
- Competitive – Provides consultancy and technical assistance services enriched by the WB’s global experience, as well as long-term financing at very competitive interest rates and maturity periods, while expanding South-South cooperation, either by adapting useful experiences from other countries or promoting lessons learned in Colombia internationally.
The International Finance Corporation (IFC) will seek investments in areas where it can add the greatest value. IFC's main objectives in Colombia are to foster greater entrepreneurship in advanced fields or in developing innovative business models. Operations will be focused on education, infrastructure development, investment climate, royalty management, and corporate governance. IFC will also explore engaging with selected agribusiness clients to enhance yields and productivity. Today, IFC's committed portfolio in Colombia is $1.1 billion, ranking as the Corporation's second largest investment portfolio in Latin America and the Caribbean. IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector.
THREE OPERATIONS TOTALING US$654 MILLION
Fiscal Sustainability and Economic Growth – US$300 million: Seeks to improve the predictability and stability of the national budget and reduce the fiscal deficit to 3.2 percent of Gross National Product (GDP) or less by 2013; support social commitments, mainly in health and pensions; and contribute to the formulation of a financial strategy for the reduction of fiscal vulnerability to natural disasters.
Support the National Urban Transportation Program – US$350 million: Helps to improve competitiveness, the environment and the quality of urban life through a better public transportation service in several cities and regions of Colombia, benefitting 1.8 million users.
Funds for Protected Areas in Colombia – an additional US$4 million: The Global Environment Facility (GEF) continues to provide support for programs aimed at protecting Colombia's rich biodiversity, such as the Conservation Mosaic Program, chosen as one of the 14 most creative and important conservation initiatives in the world during the International Biodiversity Year. This mechanism, to be implemented by the WB, will allow communities near protected areas to create, along with local authorities and representatives from National Natural Parks, collective conservation strategies and promote the sustainable use of biodiversity to improve their territories' environmental goods and services.