WASHINGTON, November 13, 2014—The World Bank Group’s Board of Executive Directors today approved a total of US$50 million to strengthen the Government of Guinea’s ability to manage public funds in response to the Ebola crisis and related macroeconomic and fiscal shocks.
The financing, which will support the Emergency Macroeconomic and Fiscal Support Operation includes a US$40 million International Development Association (IDA)* credit and a US$10 million grant allocated from the World Bank Group’s IDA Crisis Response Window, which is designed to help low-income IDA countries respond to exceptionally severe crises in a timely, transparent and predictable way.
“Guinea’s progress in economic reform is now at risk due to the Ebola crisis and if the epidemic is not contained soon it could lead to an increase in poverty through declines in consumption and investment,” said Cheick Kante, the World Bank Country Manager for Guinea. “The operation approved today will provide urgent and desperately needed financial assistance to Guinea, a country besieged by an epidemic that, along with its devastating human toll, is causing severe economic disruptions internally and also having global repercussions.”
Guinea has been at the center of the fight against Ebola but the government is constrained by a lack of resources. The emergency operation will address the government’s immediate financial needs by supporting the implementation of Guinea’s Ebola response plan—put together by the Ministry of Finance and the Ministry of Health—which includes publishing the operational plan for Ebola surveillance and containment; setting up Ebola treatment centers and placing health inspection teams at major airports; and bi-monthly monitoring of food prices in affected areas.
“The government’s financial position is likely to deteriorate as the cost of combating the epidemic increases. The Bank will mitigate these risks by helping finance the fiscal gap,” said Ali Zafar, the World Bank’s Task Team leader for the project. “The emergency operation supports policy actions that protect the health of poor, vulnerable Ebola-affected populations. It will address critical obstacles to growth, poverty reduction, and economic resilience by targeting a select set of priority reforms across areas including Ebola response and public finance.”
The operation supports reforms that will help to strengthen public financial management. Among the reforms, an Amended Finance Law that requires the government to create a new budget that takes into account the new Ebola expenditures. The second reform will ensure that the government adopts a formalized Ebola response plan. Finally, the third action will focus on transparency of Ebola spending by making all income and expenditure documents publicly available.
The US$10 million approved today as part of the EMFSO is part of previous pledges from the World Bank Group for the emergency response to Ebola. The WBG is mobilizing nearly $1 billion in financing for the countries hardest hit by the Ebola crisis. This includes more than $500 million for the emergency response and to help speed up the deployment of foreign health workers to the countries, and at least $450 million from the International Finance Corporation, a member of the World Bank Group, to enable trade, investment and employment in Guinea, Liberia and Sierra Leone.
According to the World Health Organization, as of November 9th, a total of 14,098 confirmed, probable and suspected cases of Ebola virus disease (EVD) have been reported in six countries. There have been 5,160 deaths. Guinea, Liberia and Sierra Leone have seen the highest number of cases.
* The World Bank’s International Development Association (IDA), established in 1960, helps the world’s poorest countries by providing grants and low to zero-interest loans 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 77 poorest countries, 39 of which are in Africa. Resources from IDA bring positive change for 2.8 billion people living on less than $2 a day. Since 1960, IDA has supported development work in 112 countries. Annual commitments have averaged about $18 billion over the last three years, with about 50 percent going to Africa.