Latvia, together with other member states, has participated in the World Bank’s 93 billion US dollars (82.26 billion euros) crisis support to the world’s poorest countries, paying 5.97 million euros, representatives of the Ministry of Finance (MoF) informed LETA.
The World Bank’s International Development Association (IDA) 20th replenishment (IDA20) talks on global support for 74 of the world’s poorest countries (IDA countries) to recover from the negative effects of the Covid-19 crisis were concluded on December 15 this year. The pandemic is leading to a sharp rise in extreme poverty in these countries, declining government revenues, growing vulnerabilities to external debt and instability, and about a third of IDA countries facing a growing food crisis.
In total, the IDA20 funding package amounts to USD 93 billion and is the largest historical IDA funding (IDA19 – USD 82 billion (EUR 72.53 billion)), of which USD 23.5 billion (EUR 20.8 billion) comes from 48 donor countries. approved contributions, while the rest is raised on the capital markets and from the World Bank’s own resources. Thanks to IDA’s balance sheet optimization efforts, IDA20 is the largest cycle of replenishment of IDA resources, not only in terms of funding, but also in terms of the development goals that IDA countries will achieve with the support of the World Bank.
Much of this funding will be used to help IDA countries adapt to climate change and address health challenges. This funding will also provide support to countries preparing for future crises, including pandemics, natural disasters and financial turmoil, and mobilize domestic resources more effectively through the establishment of fair and progressive tax systems in IDA countries, which Latvia achieved with IDA20. In total, IDA20 funding will help the world’s 400 million poorest people.
Latvia confirmed its donor contribution of 5.97 million euros, which is 60% higher than Latvia’s contribution to IDA19, ranking 41st in terms of contributions (previously 48th). This is the fastest growth between the Nordic and Baltic countries and the second fastest growth in terms of the share of increase, the representatives of the Ministry of Finance emphasize.
Lithuania’s contribution will be six million euros (40th to 43rd place) and Estonia’s 5.1 million euros (43rd to 47th place).
Representatives of the Ministry of Finance explain that the increase in Latvia’s contribution to IDA20 also makes a significant contribution to increasing Latvia’s total development aid funding, which is one of the lowest in the European Union.
For the first time in IDA’s history, the Nordic-Baltic Group has become the third largest donor to IDA20 with a total contribution of $ 2.03 billion (€ 1.8 billion) after the United States ($ 3.5 billion (€ 3.1 billion)). and Japan ($ 3.4 billion (€ 3.01 billion)). For the first time, Croatia and Morocco are participating in IDA20 as donors, while Algeria, Mexico and Russia have returned as donors.
The International Development Association (IDA) is an institution of the World Bank established in 1960 with the aim of reducing extreme poverty, supporting economic growth and improving the living conditions of the world’s least developed countries. IDA is the world’s largest provider of development aid and soft loans to the 74 poorest countries (IDA countries). According to the World Bank’s classification, IDA countries are those with a Gross National Income (GNI) per capita below USD 1.04 (EUR 0.92).
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