World Bank gets £1.98bn pledge from UK to support low-income countries

The United Kingdom (UK) has pledged a contribution of £1.98 billion to the World Bank’s International Development Association (IDA), in a bid to support countries with low-income economies.

The UK’s £1.98 billion pledge to IDA21 represents a 40 percent increase from its earlier contribution of £1.414 billion to IDA20.

According to the World Bank, the pledge is part of the UK’s commitment to help low-income countries achieve sustainable growth, reduce poverty, as well as improve resilience to crises.

The IDA is the World Bank’s fund with favourable terms than commercial loans, set aside for 78 low-income countries. It serves as their largest source of multilateral development finance, offering concessional financing for developmental projects in these countries.

“IDA supports a wide array of development activities—including climate adaptation, resilience-building amid conflict and fragility, primary education, basic health services, gender equality, clean water and sanitation, agriculture, infrastructure, and sustainable debt management. These efforts pave the way for equality and economic growth.

“This contribution from the UK is significant in both its generosity and the impact it will have”, said Ajay Banga, President of the World Bank Group. “Investing in IDA’s long-term, inclusive and proven development solutions are some of the best defenses we have against conflict, fragility and climate shocks. A stronger IDA secures a more prosperous, stable and resilient future for low-income countries, putting them on a path to economic growth”, a press release by the Bank stated.

Countries under the IDA (which offers concessional loans) are ineligible to access loans from the International Bank for Reconstruction and Development (IBRD). This is because the IBRD offers strictly interest-based loans.

The bank’s lending arm also has the BLEND category. This allows countries to access financing on terms that are more favourable than IBRD but less concessional than IDA.

INCOME GROUP

The World Bank categorises the world’s economies into four income groups based on their Gross National Income (GNI) per capita, which is calculated in US dollars. These groups are low, lower-middle, upper-middle, and high.

For the current 2025 fiscal year, the World Bank defines low-income economies as those with a GNI per capita of $1,145 or less (2023) and lower-middle-income economies as those with a GNI per capita between $1,146 and $4,515.

For upper-middle-income economies, the bank defines them as those with a GNI per capita between $4,516 and $14,005, while the high-income economies have a GNI per capita of above $14,005.

In sub-Saharan Africa, Burundi, Central African Republic, Liberia, Chad and Sierra Leone among others, make the list of countries with low-income economies and can access the World Bank’s IDA loans.

According to the World Bank’s categorisation, Nigeria, Zimbabwe, Cameroon, and Kenya are some of the countries with lower-middle-income economies under the BLEND category — they can access IDA and IBRD loans.