Africa gets lower World Bank support

Sub-Saharan Africa got about 16 per cent of the World Bank’s International Development Association (IDA) support as against about 19 per cent by South Asia and about 22 per cent by Latin America and Central Caribbean, in the 2012 financial year.

This is in spite of the tall needs of the Sub Saharan African region – which harbours the largest number of the poor and vulnerable – to build infrastructure and social safety nets for its people.

According to the World Bank, the low disbursement of IDA support to SSA was the result of the inability of countries in SSA to submit good project proposals and implement projects properly.

The World Bank Civil Society Team Leader, Mr John Garrison, told civil society groups meeting in Washington DC, USA that for the fiscal year ending on June 30, 2012, IDA commitments reached $14.8 billion spread over 160 new operations. Up to 15 per cent of the total was committed on grant terms.

Mr John Garrison was addressing a civil society forum being held as a precursor to the 2013 Spring Meetings of the World Bank and the International Monetary Fund (IMF) in the United States Capital, Washington DC.

The main meetings are scheduled to open from April 19-20, 2013, but civil society is meeting from April 17-20 to make inputs into the IMF policies and decisions as well as review some programmes and provide feedback on implementation and how they could be bettered.

The International Development Association (IDA) is the part of the World Bank that helps the world’s poorest countries. Established in 1960, IDA aims to reduce poverty by providing loans (called “credits”) and grants for programmes that are expected to boost economic growth, reduce inequalities and improve people’s living conditions.

IDA is one of the largest sources of assistance for the world’s 82 poorest countries, 40 of which are in Africa and it is the single largest source of donor funds for basic social services in these countries.

Since its inception, IDA has supported activities in 108 countries. Annual commitments have increased steadily and averaged about $15 billion over the last three years, with about 50 per cent of that going to Africa.

Mr Garrison said the bank, which started as a development financier to help rebuild Europe after the second world war, had evolved over the years into delivering social capital to governments; focusing on institutional capital and now on how to make projects environmentally sustainable.

Interestingly, although Africa harbours the largest chunk of the world’s extremely poor – those who live under $1.25 a day – SSA countries are not able to churn out proper proposals.

In Ghana, it emerged that a total of $1.5 billion worth of IDA funding still remained undisbursed due to delays in project design, implementation and procurement.

The President, Mr John Dramani Mahama, supported by the Minister of Finance and Economic Planning, Mr Seth Terkper, has made pledges to work to empower institutions, ministries, departments and agencies with the right skills and capacity to enable them to deliver.

Mr Garrison was happy that the World in 2010 achieved the Millennium Development Goal One of halving extreme poverty.

More than 600,000 poor people have left the group that lived on $1.25 a day. Currently, about 1.4 billion of the world’s seven billion population live in extreme poverty, of $1.25 a day. About 40 per cent of this number lives in sub-Sahara Africa.

Mr Aaron Rosenberg of the Public Affairs Unit of the International Finance Corporation (IFC),said the private sector arm of the World Bank the corporation was working on channelling more funding to, supported low income countries as well as countries emerging from conflict.

He said the corporation had a standing portfolio of $56.5 billion and out of the $5.4 billion committed funds, 18 per cent was in SSA which still had much potential for growth.

Mr Aaron said the IFC had supported projects in several sectors including telecommunications and financial sector but it was yet to have the same levels of support for the agricultural sector due to inherent risks such as child labour and food safety.

“We are, however, making a concerted effort to scale up our support for agriculture, particularly investing in small and medium scale enterprises and smallholder farmers,” Mr Rosenberg said.

Some of the civil society organisations at the forum called for closer working relationship with them in shaping policies and programmes, while giving much bigger lead role to country leadership and the people.

They want the World Bank and the IMF to control the involvement of multi-national corporations in such developing countries as SSA, since they were responsible for depriving the citizens of the needed impact of IDA support to low income economies.