ONE Responds to World Bank Development Committee
WASHINGTON – Today, the World Bank’s Development Committee formally agreed on a package to boost lending capacity, enabling the Bank to make more of the funds it has on hand. The package, which includes lowering the minimum equity-to-loan ratio to 19%, means an additional $50 billion over 10 years ($5 billion a year).
However, these measures fall far short of calls from key stakeholders ahead of the Spring Meetings – in particular from leading African finance ministers who called for commitments from the International Development Association and the International Bank for Reconstruction and Development to be tripled. This followed an open letter signed by over 100 high profile signers – including former heads of state, academics and campaigners – which set out the top ten priorities the new World Bank President will need to start addressing upon arrival.
Amy Dodd, Policy Director, Development Economics at ONE said:
“After all the talk of bold reform, this is underwhelming. Given the level of need, the steps set out today simply don’t deliver enough – releasing less than 1% of what’s required.
“With many countries calling for the World Bank and its donors to triple the amount of funding – which would leverage hundreds of billions in new finance – what’s been delivered here is less than the bare minimum.
“With new leadership and a strong appetite for reform among key shareholders, the Bank can and must go further. In time these changes could be seen as the first steps in a bigger journey. But only if they lay the foundations for much more ambitious reform over the coming months. As it stands, the job is far from done.”
ONE has released a new tool which allows users to visualize the different scenarios of the reform the World Bank could introduce and how much funding could be freed up by each of them.