Washington: The World Bank is in discussions with the international community on committing to a strong IDA20 replenishment to ensure appropriate levels of support to countries for immediate crisis response as well as getting back on track to their long-term development trajectories.
IDA has been the leading multilateral provider of concessional resources to small economies, which have been hit hard by the covid-19 pandemic.
Robust IDA support for recovery is needed now more than ever, agreed a group of country representatives convened recently for the Small States Forum.
Covid-19 has had severe economic impacts on small states — these are 50 countries that comprise the Small States Forum and face unique development challenges due to their small population and economic base.
In 2020, real GDP for the small states is estimated to have contracted by 6.1 percent, compared to a 1.8 percent contraction for all emerging markets and developing economies.
To date, the World Bank’s emergency covid-19 response has reached more than 100 countries.
Since the start of the outbreak, overall financial support to roughly 30 small states has exceeded $1 billion of which around $600 million has been geared toward the covid-19 response.
"COVID-19 is having a disproportionate impact on small states, with thousands of jobs lost and significant damage to the tourism and transportation industries among others. The World Bank Group is committed to strong recovery for these economies, complementing large-scale crisis response support with enhanced efforts to boost resilience and preparedness. IDA is making a vital contribution to small states, and a robust IDA20 replenishment will help us to sustain this good momentum," said Axel van Trotsenburg, World Bank Managing Director of Operations, in a press release issued on Wednesday.
Convening every year on the sidelines of the World Bank Group/IMF Spring and Annual Meetings, the Small States Forum provides a platform for dialogue and knowledge sharing on how the World Bank Group and the broader development community can best support small states.
This group of countries makes up more than one fifth of World Bank members, and despite their diversity, these countries share unique vulnerabilities associated with the small size of their economies and high exposure to natural disasters and other external shocks, including the current covid-19 pandemic.
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