World Bank president eyes new development funds

10/10/2010 | Anthony Rowley

World Bank president Robert Zoellick told Emerging Markets last night he is “optimistic” about the chance of putting together a coalition of traditional and new donors for replenishment of the bank’s concessional lending arm

World Bank president Robert Zoellick told Emerging Markets last night he is “optimistic” about the chances of putting together a coalition of traditional and new donors for replenishment of the bank’s concessional lending arm, the International Development Association (IDA).

Zoellick said he is in discussions aimed at securing contributions from traditional and non-traditional donors, and also urging IDA borrowers who have “graduated” from eligibility for new loans to accelerate repayment of existing loans.

“In a time of budget cuts, we are working hard to build a global coalition to share the burden of this replenishment,” Zoellick said earlier in a statement issued after yesterday’s meeting of the joint World Bank and IMF Development Committee.

“We are not just asking traditional donors to carry the load. We are asking former IDA beneficiaries to accelerate payments; we are asking IDA recipients that are close to graduating out of the programme to pay a bit more; we are asking emerging donors to contribute, to reflect their growing weight; and we are looking to mobilise our own resources.”

Officials responsible for organising the IDA replenishment, known as IDA16, will meet in Washington on Monday and Tuesday. But Zoellick emphasized that “this will not be a pledging session”and added that “we will be asking donors to do this by the end of this year.”

With fiscal spending being tightened in some advanced economies, there are fears that aid, contributions to IDA, could suffer as a consequence.

African countries cheered the Bank’s decision to assign a third seat on its 25-member board to a representative from the continent.

Renosi Mokate, a former deputy Governor of the South African reserve bank, will join the board of the World Bank at the beginning of next month.

“We have secured the position of the third seat on the executive board. We spent about three years trying to reconfigure ourselves, and finally in Freetown this year we concluded and we now have a third seat. South Africa, Angola and Nigeria represents one seat.

Uhuru Kenyatta, Kenya’s deputy prime minister and minister of finance, said: “What is required now if for all of us to work together.”

He said Africa will not necessarily seek more loans as a result of greater voting power. “There is a distinction between voice representation and resources allocation. The [additional] voice on the board just helps to strengthen Africa’s case.

“In the IMF we want to push it [too]. We now have a second alternate. We are asking them to start considering a third chair. We have convergence between the two [IMF and World Bank] It would be nice really. One representative for 20 countries is too much. We hope the IMF will be pushing for an average of 15,” he said.

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