International Development Association

FY2017 Funding Recommendation:  
$1.4016 billion

 

Funding History

       Enacted   

       President's FY2017 Request   

       InterAction's FY2017 Recommendation


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Justification

 Key Facts

  • IDA is ranked as one of the top seven most transparent development aid organizations in the world in Publish What You Fund’s 2014 Aid Transparency Index.

  • Since its inception, IDA has supported activities in 108 countries through grants and interest-free, long-term loans, half of which were directed to countries in Africa. Thirty-three recipients have since graduated and no longer receive IDA support.

  • IDA has provided more than $28.5 billion in support for fragile and conflict-affected states since 2000.

  • For every $1 the U.S. contributes to IDA, $13 more are leveraged in resources from other donors and internal IDA funds.

  • In just the past two years, the World Bank increased the number of projects reporting on gender results during implementation by 27%.

The International Development Association (IDA) is known as the World Bank’s “Fund for the Poorest.” One of the largest development financiers in the world’s least-developed countries, IDA supports antipoverty programs with long-term, no-interest loans. Since its inception, IDA has supported activities in 108 countries. Over the last three years, it has distributed on average $19 billion annually in grants and loans, directing approximately half of those funds to Africa.

IDA is a critical facilitator and financier of development projects in areas such as infrastructure, institutional development, and technical support. It leverages the efforts of other donors to help developing countries develop the systems and capacity they need to use donors’ funds effectively.  Between 2011 and 2015, IDA ensured: 50 million people obtained access to water sources, 413 million people had access to health services, 17 million women received prenatal care, 205 million children were immunized, and 5.1 million teachers were recruited and/or trained.

In December 2013, donors committed a record $52 billion to the 17th IDA replenishment to cover IDA financing for three years (from July 1, 2014 to June 30, 2017). The U.S. commitment for 2017 is $1,290,600,000. InterAction supports the President’s FY2017 request for $1,384,072,000 which includes the full U.S. 2017 commitment and covers the $93,472,000 that was not included in the FY2016 appropriation. 

With these funds, IDA estimates that from 2014 to 2017, it will provide:

  • Electricity for 15-20 million people;

  • Life-saving vaccines for 200 million children;

  • Microfinance loans for more than 1 million women;

  • Basic health services for 65 million people;

  • Access to clean water for 32 million people; and

  • Access to improved sanitation facilities for 5.6 million people.

Multilateral Debt Relief Initiative

In addition, as of the end of FY2016, the U.S. is approximately $414 million behind in payments for our commitment to the Multilateral Debt Relief Initiative (MDRI), which provides certain low-income countries with 100% relief on eligible debt from three multilateral institutions at IDA and the African Development Fund. InterAction recommends an additional $111 million to continue paying down our arrears to the IDA MDRI, consistent with the President’s FY2017 budget request.

This brings the total InterAction funding recommendation for FY2017 to $1.495 billion.

Success Story

Employment Generation Program for the Poorest in Bangladesh

Twice a year before the harvests, fewer laborers are needed to cope with the grain production and there is a shortage of employment opportunities in rural Bangladesh. The seasonal job drought hits the poorest the hardest as they struggle to put food on the table and meet the basic needs of their families. Men are forced to leave for the city in search of employment, leaving women and children in the villages. Reaching these extremely vulnerable people has always been the greatest challenge for the government of Bangladesh. The Employment Generation Program for the Poorest (EGPP), established in response to the 2008 global food price crisis, has been providing a secure and regular source of income to over 800,000 of the poorest people. Over 33% of the participants are women. The EGPP has become one of the largest well-targeted safety net programs in Bangladesh, and has consistently received the highest increases in Government budget allocation, compared to similar programs, over the past five years.

From FY2011 through FY2013, $150 million in IDA financing supported EGPP through a results-based credit whereby funds are released upon achievement of milestones focused on improving targeting, enhancing transparency, and strengthening monitoring and evaluation capacity. This approach created incentives for efficiency and allows for innovation, making the EGPP the dynamic program it is today. With additional grant funding of $1 million, IDA also piloted projects to test electronic worker attendance systems that linked to payments using mobile phones and Postal Cash Cards. Based on the satisfactory outcomes of the results-based IDA financing and the grant, a follow-on results-based IDA Credit of $500 million is currently supporting the Government in further improving the equity, efficiency and transparency of other similar programs along with EGPP.

Since its inception in late 2010, EGPP has produced notable results: 800,000 people in extreme poverty are now employed every year, including over 300,000 women; 16,000 community level sub-projects, mostly building and repair of rural roads, are implemented twice a year; over 60 million work days are created per year; and 100% of payments are made via beneficiary bank accounts.  In FY2016 the government of Bangladesh has increased its share of the costs by approximately $190 million – a 50% increase over from when IDA financing was initially committed in FY2011.

Photo: World Bank

 

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