Riyadh- World Bank’s Vice President of Development Finance (DFi) Axel van Trotsenburg said that the bank had issued at least $90 billion dollars to underprivileged countries. The sum mentioned amounts to 44 percent of the International Development Association (IDA) fund. IDA contribution is expected to reach out to 77 deprived countries by 2018, with a $75 billion giveaway. Africa has notably benefited from the international institution with a figure standing somewhere near a whopping $45 billion dollars.
IDA VP Axel van Trotsenburg told Asharq Al-Awsat that Saudi Arabia’s vision for national transformation, also known as Kingdom’s vision 2030, is considered an ambitious outline drafted with sharp prudence and is in keep with the country’s prospect economy demands.
Trotsenburg said that IDA’s next step will focus its attention to countries ripped apart by war and conflict—a sum of $15 billion will be devoted to the cause, added to a $2 billion fund dedicated to refugees in the Middle East and Africa.
Speaking on Syria, Trotsenburg said that primary pointers show that a Syria post-peace restoration might be supplied with a $1 billion for the reconstruction of infrastructure. As for IDA’s contribution to Yemen, the international body will be embarking on new goals, such as the creation of job opportunities for the Youth, added to the support and funding of both the public and private sectors.
Trotsenburg said that the funding chiefly aims to revitalize the economies of war-torn countries.
Six major challenges face 77 countries: poverty, poor development of the economy, unemployment, lack of integration, climate change, and vulnerability to violence.
Trotsenburg said that when meeting with Saudi Finance Minister Mohammed Al-Jadaan he discussed the IDA’s framework, in addition to the upcoming December meeting set in Indonesia. The meeting will negotiate the funds of over 50 granting states.
The fund functionality and limits will also be attended. Considered one of the major contributing states, and a chief role player in the region, Trotsenburg said that he discussed developments on the negotiations to the Saudi Finance Minister, especially that in December sponsoring states will decide on their financial commitments to the IDA.
Trotsenburg added that the IDA works with countries with a shocking $1,200 annual income per capita, such as Yemen and Djibouti. Countries recording low income rates are not considered eligible for international loans. They can only access interest-free small credit on a 20-year plan.
When discussing global economies, Trotsenburg said that growth rates fluctuate from one state to another–countries such as Rwanda and Ethiopia average a 10 percent growth, whilst other Asian countries register an 8-9 percent growth.
Countries such as Yemen, ravaged by conflict and loss of infrastructure, have unfortunately recorded recession rather than growth.
The IDA is the part of the World Bank that helps the world’s poorest countries. Overseen by 173 shareholder nations, IDA aims to reduce poverty by providing loans (called “credits”) and grants for programs that boost economic growth, reduce inequalities, and improve people’s living conditions.
IDA lends money on concessional terms. This means that IDA credits have a zero or very low interest charge and repayments are stretched over 25 to 40 years, including a 5- to 10-year grace period. IDA also provides grants to countries at risk of debt distress.
IDA is a multi-issue institution, supporting a range of development activities that pave the way toward equality, economic growth, job creation, higher incomes, and better living conditions. IDA’s work covers primary education, basic health services, clean water and sanitation, agriculture, business climate improvements, infrastructure, and institutional reforms.