More funds for combating poverty – Finland contributes 105 million euros

Press release 239/2016
16.12.2016

IDA18, the donor meetings for replenishing the resources of the International Development Association IDA (a part of the World Bank) were completed on 15 December in Yogyakarta, Indonesia. The IDA lends money on concessional terms as well as providing aid to the poorest developing countries.

The aim of the IDA is the eradication of extreme poverty and the more balanced distribution of well-being. The demand for IDA funding is strong and its operations have a noticeable effect on development. At the moment, the conditions for funding are met by 77 countries, of which 39 are in Africa. In the replenishment talks, a consensus was reached on the operational policy of the IDA and on increasing the level of funding to 75 billion dollars for the period 2017–2019.

In addition to the $27.2 billion contribution of the funders, this includes the bank's internal financing, Concessional Partnership Loans (CPL) and the IDA's capital leverage. This round is the largest in the 56-year history of the IDA, as now with the new way of leveraging the IDA's capital it is possible to attract significantly more funding.Funding is provided by 47 states.

The biggest funders continue to be the United States, the United Kingdom and Japan. Finland contributes 105 million euros to the funding. The emphasis in the funding round is on investments in the poorest countries to enable growth, opportunities and social adaptability. Spearhead themes are gender equality, environmentally sustainable development, the economic growth of developing countries and employment, the strengthening of administration and institutions and especially support for fragile and conflict states. Annually, an average of 19 billion dollars of concessional loans with long payback times are granted through the IDA.

The main focus is on infrastructure projects as well as education and health-related projects. In the years 2017–2020, IDA funding will be supporting the basic healthcare of 400 million people, enabling the education of 9–10 million teachers and providing vaccinations for 130–180 million children.

Furthermore, 11 million women will be receiving maternity services and 45 million people provided access to better water services. The capacity for renewable energy production will be increased by five gigawatts. A total of 1.3 billion people live in countries receiving IDA credits.

The emphases of the latest funding round are in line with Finland's own development policy targets. In the negotiations, Finland highlighted improving the effectiveness of aid and the role of inclusive economic growth in the eradication of poverty.

More information: Director General Satu Santala (IDA main negotiator), tel. +358 (0)295 351 815 Team Leader, World Bank Group, Counsellor Leena Ritola, tel. +358 (0)295 351 524

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