IDA for Africa: Heads of State Summit

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After advocating for an ambitious 20th replenishment of the World Bank’s International Development Association (IDA20) at their Heads of State Summit in Abidjan in July 2021, African leaders convened again in Dakar, Senegal, on July 7, 2022, to call for a strong start to the implementation of IDA20 focused on a robust and resilient recovery for Africa.

Hosted by Senegalese President Macky Sall, the Summit welcomed several Heads of State and Government from across the continent. 

African countries have been hit hard by the multiple global crises of climate and COVID-19, growing levels of food insecurity, and more recently by the impact of the war in Ukraine. The IDA20 program will support a resilient recovery from these crises, and help the continent continue its economic transformation. The summit also endorsed the work and relevance of IDA as a partner of choice in the region. IDA is one of the largest sources of funding for fighting extreme poverty in the world’s lowest income countries. Africa is IDA’s biggest beneficiary with 39 countries and has made significant headway in improving development indicators during six decades of partnership with the World Bank.

Summit deliberations focused on five priority areas for the region: 

• Economic transformation; 

• Agriculture, livestock, and food security; 

• Human capital; 

• Digital and technological innovations; and  

• Energy transition.

For more details, read the Dakar Call to Action

What is IDA?  

The International Development Association (IDA) is one of the largest and most effective platforms for fighting extreme poverty in the world’s lowest income countries.  

• IDA works in 74 countries in Africa, East Asia, South Asia, Europe & Central Asia, Latin America & Caribbean, and Middle East & North Africa. 
• IDA aims to reduce poverty by providing financing and policy advice for programs that boost economic growth, build resilience, and improve the lives of poor people around the world.   
• More than half of active IDA countries already receive all, or half, of their IDA resources on grant terms, which carry no repayments at all. Grants are targeted to low-income countries at higher risk of debt distress.     
• Over the past 60 years, IDA has provided about $458 billion for investments in 114 countries.  

How is IDA funded?

• IDA partners and representatives from borrower countries come together every three years to replenish IDA funds and review IDA’s policies. The replenishment consists of contributions from IDA donors, the World Bank, and financing raised from the capital markets.   
• Since its founding in 1960, IDA has had 19 replenishment cycles, and begins the 20^th cycle on July 1, 2022. IDA20 was replenished in December 2021 with $93 billion, of which $23.5 billion came from IDA donors.  

 IDA and Africa

• With 39 countries benefitting from IDA support, Africa is the largest recipient region for IDA.
• IDA has been Africa’s reliable long-term partner for six decades. Its financing commitments to Africa have steadily increased over the years to respond to growing challenges and deliver results that have improved millions of lives and translated into larger shifts in countries’ development:
  
  • IDA15 (FY09-FY11) – $22.08 billion
  • IDA16 (FY12-FY14) – $25.78 billion
  • IDA17 (FY15-FY17) – $29.72 billion
  • IDA18 (FY18-FY20) – $48.74 billion
  • IDA19 (FY21-FY22) – $28.64 billion
• Of the top 10 IDA borrowers eight are in Africa. These are Nigeria, Ethiopia, Sudan, Kenya, Democratic Republic of the Congo, Mozambique, Tanzania, and Niger.
• With IDA’s support, countries in the region are addressing the impacts of the COVID-19 pandemic and other crises, tackling long-term structural challenges, and achieving lasting development results. 

The IDA20 Program

To help IDA countries address the multiple crises they are facing and restore their trajectory towards the 2030 development agenda, IDA20 will focus on Building Back Better from the Crisis: Towards a Green, Resilient and Inclusive Future.

This overarching theme will be supported by five special themes: 

• Human Capital: Address the COVID-19 emergency and lay the foundations for an inclusive recovery. This theme will continue to help countries manage the pandemic through vaccination programs deployment, scaling up safety nets, and building strong and pandemic-ready health systems. It will continue to support the Africa Human Capital Project. 
• Climate: Raise the ambition to build back better and greener; scale up investments in renewable energy, resilience and mitigation, while tackling issues like nature and biodiversity. 
• Gender: Scale up efforts to close social and economic gaps between women and men, boys and girls. It will address such issues as economic inclusion, gender-based violence, childcare, and reinforcing women’s land rights. 
• Fragility, Conflict, and Violence (FCV): Address drivers of FCV, support policy reforms for refugees, and scale-up regional initiatives in the Sahel, Lake Chad, and Horn of Africa. 
• Jobs and Economic Transformation: Enable better jobs for more people through a green, resilient, and inclusive recovery. IDA20 will continue to address macroeconomic instability, support reforms and public investments, and focus on quality infrastructure, renewable energy, and inclusive urban development. 
  

IDA20 will deepen recovery efforts by focusing on four cross-cutting issues:

• Debt Sustainability and Transparency: The Sustainable Development Finance Policy will continue to be key to support countries on debt sustainability, transparency, and management.  
• Governance and Institutions: Strengthen public institutions to create a conducive environment for a sustainable recovery. Facilitate transformation to more inclusive and resilient post-pandemic economies. Reinforce domestic resource mobilization, digital development, and combat illicit financial flows. 
• Technology: Speed-up digital transformation with the focus on digital infrastructure, skills, financial services, and businesses. Also address the risks of digital exclusion and support the creation of reliable, cyber secure data systems. 
• Crisis Preparedness: Strengthen national systems that can be adapted quickly, and shock preparedness investments to increase country readiness (e.g. shock-responsive safety nets).