Session I – Global Economy and Risk
Thank you, Chair. Let me express to Ukraine through the Minister our full solidarity and support.
The World Bank Group is disbursing rapidly to Ukraine to support the continuation of essential government services and private sector activity.
We have mobilized $1 billion so far and are preparing another $1.5 billion package.
Parallel funding and bilateral guarantees are helping leverage this package. We set up a Multi-Donor Trust Fund that will disburse donor grants in a targeted, rapid, and secure manner.
Thank you to Japan, the UK, the Netherlands, and several European countries that are using these mechanisms and we invite others to use these mechanisms or provide direct support.
I just returned from Poland and Romania. We are working to support Ukrainian refugees and host communities, and help them plan for the return home.
The impact is reaching far beyond the borders of eastern Europe in part through the price spikes in food, fertilizer, and energy. We are responding directly, and we will be presenting to our Board a 15-month crisis response envelope of around $170 billion to cover April 2022 through June 2023. The $93 billion package of IDA20 will be an important part of this effort.
We look forward to working with all of you on these vital challenges.
Thank you.
Session II – Global Health Issues
The health crisis isn’t over. To respond, the World Bank Group mobilized the largest and fastest crisis response in our history, reaching $157 billion.
By June, we will have committed $11 billion in vaccine financing for 81 countries.
We still have much work to do to get vaccines into people’s arms in poorer countries. Only 11% of people in low-income countries are fully vaccinated, compared with 73% in high-income countries.
We’ve worked very closely on this with the IMF, WHO, and WTO (sitting near me) and are working with many partners to identify and resolve finance and trade impediments to vaccine, diagnostics, therapeutic production, and deliveries.
To reach global targets requires a continued, concerted, and country-led push to deliver vaccines. The greatest benefits will come from prioritizing high-risk populations.
Looking beyond COVID-19, national healthcare system capacity will need to be strengthened. COVID-19 vaccination services will need to be integrated with other immunization services and other health and social interventions. This is important for maximum impact and to build long-term capacity.
COVID-19 has exposed large financing needs to strengthen pandemic preparedness and response (PPR). The bulk of financing will have to come from domestic resources, while external financing can play an important, complementary role.
We are currently working to strengthen health systems in over 100 countries and have a $30 billion active portfolio.
There is an important role for a new, multilateral financing facility that can provide dedicated funds to strengthen PPR at the country, regional, and global levels.
There is growing support from G20 members to establish a new Financial Intermediary Fund (FIF) for PPR, hosted at the World Bank.
A key part of the FIF’s effectiveness will be the financial contributions from G20 countries and other donors. The new FIF will bring additional resources, incentivize countries to increase domestic investments, and complement ongoing efforts.
I would like to particularly commend the U.S. for their leadership.
I’m looking forward to working with interested partners and the WHO, so we will proceed quickly to develop the design elements of the FIF and open for business soon.
Thank you.
Session III – International Financial Architecture
This morning’s IMFC meeting heard strong presentations on debt vulnerabilities and the urgency of early resolutions.
Debt vulnerabilities are rising in both low and middle-income countries. Debt is at a 50-year high – equal to roughly 250 percent of government revenues. Around 60 percent of the world’s poorest countries are now in debt distress or at high risk of it. The tightening of financial conditions and the war in Ukraine are making this fragile scenario even worse.
To make debt work for development, we must redouble our efforts. We need to allow for a rapid debt restructuring process, reduce unsustainable debt burdens, and create better borrowing practices to break free from the rinse and repeat cycle of debt crises.
We are working hard with Kristalina and the IMF to improve the implementation of the Common Framework. Several steps would help:
- Establishing a timeline for forming creditors’ committees. There was a proposal this morning to form the Zambia committee by the end of April, which would be an important step forward.
- Suspension of debt service payments and penalty interest.
- Expanding eligibility.
- A simple rule so that comparability of treatment can be evaluated and enforced.
- Engaging debtor countries and commercial creditors at the beginning of the process.
- A secretariat for the Common Framework.
I would like to spend my remaining time on debt transparency, which is key. We have made some progress – as a result of World Bank analytical work on debt transparency and the new IDA Sustainable Development Finance Policy (SDFP), the number of low-income economies providing disclosures on government debt has increased by 17 percentage points, a positive trend.
Our International Debt Statistics includes new, more granular information on what each borrowing country owes to each official and private creditor and the financial terms. We are also planning to include information on state-owned enterprise debt, central banks swaps, and collateralized debt.
Thank you all very much.
