On January 16, the Bretton Woods Committee (BWC) –in partnership with the Center for Strategic & International Studies (CSIS) – welcomed over 80 members and friends to a panel discussion on Building an IDA for the Future: Perspectives on the 17th Replenishment of the International Development Association. Co-chair Jim Kolbe participated as a panelist and Co-Chair Bill Frenzel offered introductory remarks.
Moderator Dan Runde, a Bretton Woods Committee member and Director of the Project on Prosperity at CSIS, framed the discussion by level setting the audience on how IDA – the world bank’s fund for the poorest countries – is funded, including through grant contributions, concessional loans, and profits from the World Bank’s sister institutions, the IBRD and IFC. Given the constrained fiscal environment in the U.S. and advanced economies, he remarked that both the overall sum of approximately $52B in global pledges as well as the $U.S. pledge of nearly $4B over the next three years was impressive, and actually a slight increase in nominal terms from the IDA16 replenishment.
Joachim von Amsberg, Vice President of Concessional Finance and Global Partnerships at the World Bank and heavily involved in the IDA17 replenishment negotiations, first expressed great appreciation to the Bretton Woods Committee for its strong expressions of support for IDA. He framed IDA17 as a truly multilateral deal, with over 50 countries involved in negotiating both the policy and financing package. Von Amsberg highlighted the special themes of IDA17 – including inclusive growth, support for fragile and conflict-affected states, gender, and climate change – and summarized the policy component in terms of results and leverage. While IDA’s track record of services is well known – supporting hundreds of millions of people with basic health, nutrition, food and water, education, electricity, or other population services – IDA will not shy away from the longer term and less tangible institution-building work that is critical for sustainable development. Donors such as the United States benefit from leverage not only in terms of extending the reach of their development financing (e.g. $4B influencing over $50B in development priorities), but also in terms of resources deployed at the country level, projects that attract private sector investment, and the knowledge base and experience of development efforts across countries that are applied in IDA engagements.
Sara Aviel, United States Alternate Executive Director to the World Bank, also applauded the strong package of IDA17 policy and financial commitments, as well as the work of the Bretton Woods Committee to educate lawmakers and the public about the importance of IDA. She remarked at the critical timeliness of the IDA17 replenishment negotiations taking place in parallel with the reform strategy of the World Bank Group, and how these reform objectives are appropriately woven into IDA goals and outcomes. Aviel stressed U.S. support for IDA17 themes, and touched on some of the specific components that the United States has strongly advocated for, such as: strengthening monitoring & evaluation (M&E) frameworks through tools like impact evaluation and beneficiary feedback; setting a higher bar for gender goals, such as evaluations and exit ratings for projects; enhancing project performance-based resource allocations for fragile and conflict-affected states; and focusing on increasing opportunities for private sector development.
Former Congressman Jim Kolbe (R-AZ), Co-chair of the Bretton Woods Committee, touched on the appropriations process and the level of support for IDA in the U.S. Congress. He noted several reasons why IDA17 – which received nearly the full first year appropriation based on what was pledged by the Obama Administration – has been received positively on Capitol Hill. Most notably, “flying under the radar screen works to IDA’s advantage,” Kolbe remarked. IDA gets an easier time because it is not a lightning rod like other issues, does not have the same political undertones as aid to, say, Egypt or Israel, focuses on the poorest of the poor, is open, transparent, and one can point to concrete results. This stands in contrast to some of the lightning rod issues that the International Monetary Fund (IMF) is currently facing with Congress.
Finally, Mansur Muhtar, the World Bank Group Executive Director for Nigeria, Angola, and South Africa, shared perspectives of African leaders on the IDA17 replenishment and on Nigeria’s development priorities. He noted that African country Ministers were very active in championing the IDA17 replenishment and in negotiating the policy priorities with IDA donor countries. He emphasized African countries’ strong interests in leveraging IDA support to adopt a strategic approach on transformative development projects, help develop economies of scale, focus on infrastructure, and emphasize inclusion and job creation. Priorities for Nigeria, which receives approximately $5B in IDA assistance (a blend of grants and loans), are to ensure IDA projects promote results-based lending that could be replicated on a larger scale, to exploit synergies and financing through other donors, and to leverage both IDA and private sector in the power sector. Muhtar also commented that a key challenge will be to increase the involvement of civil society, and to find ways to better drive national development priorities and resources through sub-national arrangements.
Participants then had the opportunity to engage in lively Q&A with panelists on topics such as M&E standards for fragile and conflict-affected states, IFC credits and its relationship with IDA, and other forms of leverage, such as policy conditionality. The Committee would like to thank CSIS for hosting this event.