World Bank President Ajay Banga expressed confidence that donor countries will fulfill African leaders’ plea for significant contributions to a low-interest facility aimed at supporting developing nations.
Ajay Banga said that these contributions are not merely handouts but strategic investments in the future.
In a conference on Monday, African heads of state urged wealthy nations to mobilize a minimum of $120 billion for the International Development Association (IDA) at an upcoming event scheduled to take place in Japan in December.
Such a financial commitment would set a new record for IDA, which provides extended loans to developing nations and operates on a three-year cycle. The previous fundraising round in 2021 amassed $93 billion.
Achieving the $120 billion target entails donors contributing approximately $30 billion, as the World Bank can leverage $3 in borrowing for every dollar raised.
“There is no doubt that all the donor countries have their own challenges and their own fiscal responsibilities. But I think they all value the effect of contributing to IDA,” Banga said in an interview.
More than half of the 75 countries benefiting from the IDA facility are African nations. These countries face challenges such as heavy debt burdens and climate-related disasters, yet they find it difficult to secure affordable financing on the international market.
Access to IDA loans is therefore vital as Africans leaders have already stated.
Banga said that wealthy nations should acknowledge that generous contributions are mutually beneficial, pointing to examples such as China and India, which were once recipients of IDA assistance but have since evolved into significant economies.
“I think the most important message is actually that this is not a handout,” he said. “If Africa develops well, Africa has a lot to offer the world.”
