The World Bank Group says it has spent $157 billion to fight Covid-19 related health, economic, and social impacts over the last 15 months.
In a report, the multilateral institution said the fund spent between April 1, 2020 to June 30, 2021 was in response damages done by COVID-19 to the lives and livelihoods of millions of people in developing countries.
This is the largest crisis response of any such period in the Bank Group’s history and represents an increase of more than 60 per cent over the 15-month period prior to the pandemic.
World Bank Group President David Malpass explained that since the start of the pandemic, the World Bank Group has committed or mobilized a record $157 billion in new financing, an unprecedented level of support for an unprecedented crisis.
“We will continue to provide critical assistance to developing countries through this ongoing pandemic to help achieve a more broad-based economic recovery. The Bank Group has proven to be a rapid, innovative, and effective platform to support developing countries as they respond to the pandemic and strengthen resilience for future shocks. But we must do more still. I remain deeply concerned about limited availability of vaccines for developing countries, which are critical to save lives and livelihoods,” he said.
Also, the International Finance Corporation (IFC), the Bank Group’s private sector development arm, reached a record high of $42.7 billion in financing, including short-term finance ($10.4 billion) and mobilization ($14.9 billion), 37 per cent of which was in low-income and fragile and conflict-affected states.
The IFC provided liquidity for businesses to remain in operation, while ramping up investments in companies on the front-lines of the pandemic response. To address the COVID-induced increase in the trade gap, IFC has expanded its trade and supply chain finance activities. IFC’s “Upstream” work continues to create the conditions to attract much-needed private investment to some of the world’s most difficult places and preparing the ground for a faster private sector recovery.
The IFC, rated AAA/Aaa, issued close to $13 billion in bonds for private sector development and job creation in emerging markets. The Multilateral Investment Guarantee Agency (MIGA), whose mandate is to drive impactful foreign direct investment to developing countries, issued $7.6 billion in new guarantees over the same 15-month period since the onset of the pandemic, of which 19 per cent supported projects in IDA countries and fragile settings.
The World Bank Group said its commitments and mobilizations in fiscal year 2021 alone (July 1, 2020 – June 30, 2021) amounted to almost $110 billion (or $84 billion excluding mobilization, short-term financing, and recipient-executed trust funds).
The bank said that since the start of the pandemic, it supported countries to address the health emergency, strengthen health systems, protect the poor and vulnerable, support businesses, create jobs and jump start a green, resilient, and inclusive recovery.
Following last year’s COVID-related economic deterioration, the global economy is expected to expand 5.6 per cent in 2021.
“Thus far, the recovery is uneven and many of the world’s poorest countries are being left behind. While about 90 per cent of advanced economies are expected to regain their pre-pandemic per capita income levels by 2022, only about one-third of emerging market and developing economies are projected to do the same,” the bank said.
In 2020, global extreme poverty rose for the first time in over 20 years, with nearly 100 million people pushed into extreme poverty.
In the 15 months ending June 30, 2021, the Bank Group stretched its balance sheets, accelerated leveraging and disbursements, and front-loaded resources.
It said support to countries from the International Bank for Reconstruction and Development (IBRD) totaled $45.6 billion – including drawing down IBRD’s $10 billion crisis buffer in addition to Board-approved sustainable annual lending limits.
Grants and zero or low-interest loans to the world’s poorest countries from the International Development Association (IDA) amounted to $53.3 billion.
