World Bank Group has announced plans to invest and mobilise another $150 billion to support Africa’s development over the next five years.
David Malpass, president, World Bank Group, stated this on Tuesday in his remarks at the Summit on Financing African Economies, which he posted on his official Twitter handle.
A large portion of the fund will be through grants and long-term, zero-interest-rate loans from International Development Association (IDA), which continues to provide strong positive net flows to Africa.
IDA is an international financial institution which offers concessional loans and grants to the world’s poorest developing countries.
Nigeria and Pakistan, are IDA-eligible based on per capita income levels and are also creditworthy for some of the International Bank for Reconstruction and Development (IBRD) borrowing. They are referred to as “blend” countries.
Over the past decade, the World Bank Group has invested $200 billion in Africa. Malpass said Africa is full of investment opportunities that can attract private enterprises and investors from around the world.
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The World Bank Group, he said is using all possible resources, financing tools, and dedicated staff across the continent to improve African lives and business prospects.
“I listened carefully to the challenges of vaccine access, inequality, and debt. I underscore the urgency in helping Africa overcome these crises. It’s clear that some countries will soon have vaccine supplies that vastly exceed demand, and I’ve repeatedly urged them to release the excess to countries that have delivery programs in place.
“We have Board-approved financing operations in many African countries to obtain safe doses and to administer them quickly and fairly as soon as the producer countries, COVAX, or manufacturers are ready,” he said.
Africa, he said needs large inflows of long-term resources. “In addition to IDA, another important part of our support to Africa will be mobilisation of the private sector, either directly through International Finance Corporation (IFC) and Multilateral Investment Guarantee Agency (MIGA) mobilisations or indirectly through the mobilisation of funding by IDA and IBRD on capital markets”.
Malpass highlighted the initiatives he discussed with French President, Emmanuel Macron.
These include first, closing the infrastructure gap and improving access to low-carbon electricity. “Second, IFC has doubled our trade finance. To continue this effort, we’re announcing that IFC and MIGA are about to launch a joint trade finance initiative in selected African countries. Third, we’re working to expand alternative small-business finance. And fourth, to support agribusiness activities, we’re proposing a 3-year pilot for a user-friendly blended finance facility, “he said.
According to Malpass, debt sustainability, and transparency will also be vital in attracting new financing and investment.
“We supported the G20’s DSSI deferrals, although participation by major creditors has been only partial and continue to allow large profits to be withdrawn from Africa even during the crisis, with no prospect of the debt cancellations that many advocated today.
“We are strongly supporting the IMF and G20 in implementing the G20’s Common Framework for debt reduction,” he said.
