IDA-13 Update
On July 1, 2002, 39 donor countries, including the United States, agreed to increase the funding they give to the International Development Association (IDA), the lending branch of the World Bank. Under the agreement, $23 billion will be contributed over the next three years as loans and grants to 79 countries. One of the great achievements of the agreement is that 18 to 21 percent of IDA loans will be funded to countries in the form of grants. Also for the first time, IDA-13 will allow for IDA funding to be used in the private sector.
According to a testimony given by Treasury Undersecretary John B. Taylor, "this landmark agreement means that IDA will provide nearly 100% of its assistance on grant terms for education, health, nutrition, potable water and sanitation in countries whose people live on less than a dollar a day. All of IDA’s assistance for HIV/AIDS will be in grant form…All of IDA’s assistance for natural disaster reconstruction will be in grant form. And up to 40% of IDA’s assistance to post-conflict countries will now be delivered on grant terms."
Undersecretary Taylor also stated that donor countries urged the World Bank to establish a results-based measurement system to link IDA programs to a country’s development outcomes. He stated,
"Donors and developing countries will benefit from routinely quantifying development achievements and understanding the reasons for success and failure. This will increase learning and accountability for development results." If the IDA makes progress on such a system, the United States will provide an additional $100 million to the IDA. Also, if satisfactory results are achieved in the areas of education, health and private sector development, the U.S. will provide an additional $200 million in funding. Funding will be increased if there is an increase in primary school completion, an increase in measles immunization coverage and a reduction in both the number of days and the official costs required to start a business in IDA countries.
1For the first time since the IDA’s establishment in 1960, representatives from borrowing countries participated in discussions, and policy papers prepared for IDA-13 were made publicly available in advance of the Deputies’ meetings.2 For further information, contact the World Bank at (202) 473-1000 or review their website at www.worldbank.org .