Following the historic $75 billion replenishment of IDA18 over three years, Development Finance Vice President Axel van Trotsenburg provided a briefing to UN in New York on January 26th, emphasizing the important global commitment towards the world’s poorest.
The meeting, convened by the President of the 71st session of the UN General Assembly (PGA) Peter Thomson, was part of a broader World Bank Group (WBG) series on Sustainable Development Financing in Action as well as an ongoing series of events organized by the PGA to help drive implementation of the Sustainable Development Goals and promote sustainable finance. The PGA underscored the need to bring together all stakeholders to meet the financing gap for the SDGs and welcomed the sharing of information on WBG instruments and policies to promote development financing.
Mr. van Trotsenburg highlighted in his briefing that the IDA18 replenishment demonstrates an unambiguous assurance for multilateralism at a time of compounding challenges including global economic headwinds, climate change, fragility and violence, crises, pandemics and demographic pressures. IDA is an important platform that responds to these global challenges and the implementation of the 2030 Agenda for Sustainable Development.
The IDA18 replenishment makes resources available to countries in fragile and conflict situations, scales up the Crisis Response Window, introduces a refugee sub-window, establishes an IFC-MIGA Private Sector Window and scales up regional support. The IDA18 priorities - which include targeting investments in jobs and economic transformation, governance and institution building, gender and development, climate change and fragility, conflict and violence - represent a comprehensive policy package for countries working towards the Sustainable Development Goals (SDGs).
Mr. van Trotsenburg emphasized that IDA18 presents a bold paradigm shift in how the organization mobilizes finance to support a policy package for countries to achieve their goals. For the first time in IDA’s history, it will blend donor contributions with internal resources and capital market debt, thereby increasing the financial support it provides to countries. A public credit rating of IDA, a triple- A rating, was announced in September 2016. This will allow IDA to raise money in the capital market and scale up even more assistance to the most vulnerable countries. It was noted that this was one the first concrete steps towards realizing the Addis Ababa Action Agenda on financing for development.
Assistant Secretary-General for Economic Development at the UN Department of Economic and Social Affairs (UNDESA), Lenni Montiel noted in his remarks the importance of policy coherence for delivery of the IDA priorities and SDGs, and the need to strengthen all sources of financing in response to growing demands. Participants raised a number of important questions related to the links between IDA and the SDGs, access to financing, national ownership, de-risking for private sector investment, the support available to middle income countries, and graduation policies. UNDP and UNICEF further reflected on the important ongoing collaboration between the WBG and the UN as well as the opportunities for further engagement under IDA18 to support low-income countries and the humanitarian-development spheres.