World Bank To ProvideOver $50bn In Grants To Most Fragile Countries In 2021
Vanguard reports, World Bank, Wednesday, revealed that it will provide over $50 billion in grants by June 2021 to the most fragile countries and people to reduce the effect of the coronavirus, COVID-19 pandemic.
The President of World Bank Group, David Malpass in its remark at the G20 Finance Ministers and Central Bank Governors Meeting stated that the latest economic and poverty data by the bank showed that desperate inequality is being caused by the COVID pandemic and economic shutdowns.
According to him ‘: “The recession in advanced economies is less severe than had been feared, but in most developing economies, it has become a depression, especially for the poorest. Extreme poverty may rise by 150 million by 2021.
“Soon after our spring meetings, we were able to launch health emergency programs in 111 countries and begin a surge in our grants and highly concessional lending that will reach the limits of our capital structure and commitment authority. As part of this effort, we expect to provide over $50 billion in grants or highly concessional credits by June 2021, helping provide large net positive flows to the poorest and most fragile countries and people.”
He emphasised that in March, the G20 endorsed a vital debt relief program for the poorest countries, giving people a ray of hope.
“The Debt Service Suspension Initiative, DSSI helped increase fiscal resources for over 40 countries and created more transparency on the overwhelming debt burden. This week, we published more granular data on debtors and creditors which will help identify problems and work toward sustainability.
Our goals for debt relief in the spring meetings were clear – fiscal savings for the poorest countries, greater debt transparency, and a path forward for countries in debt distress. We’re making progress but not nearly enough. The DSSI extension being agreed today is welcome, and the term sheet has been strengthened in important ways.”
Challenges
“The scale of the challenges ahead is staggering, so we need to do more. With the strong support of its shareholders, IDA has frontloaded IDA-19 resources to the fullest possible extent as a key part of the surge in our commitments this fiscal year. However, IDA lending would have to decline in the next two years even though the latest forecasts, including those just announced by the IMF, suggest that the reduction in economic activity will extend well into subsequent years. We are proposing to IDA Deputies later this month a $25 billion supplemental COVID Emergency Financing Package. We’ll be grateful, as always, for your support” the World Bank said.
