World Bank to implement $170bn response to covid, inflation and food security crisis
The World Bank will in the coming few weeks make available some $170bn in fiscal support to countries hit hard by rising inflation and food insecurity as a result of the Russian-Ukraine war as well as the lingering impacts of the Covid pandemic.
Making the assertion during his opening remarks for the Spring Meetings 2022 media roundtable, President of the World Bank, David Malpass, noted the funds will be available subject to discussions and approval by the Board of the World Bank.
According to him, when approved some $50bn will be immediately released to tackle the ongoing crisis for the next three months – May to July.
The $170bn as noted by Mr Malpass, will be spread over a 15 months period starting April 2022 to June 2023.
“Global trade is still facing quotas, high import tariffs, high export tariffs, expensive food price subsidies, and even export bans on food products. These should stop. The international community needs to immediately step up emergency assistance for food insecurity and help bolster social safety nets. From the World Bank’s standpoint, we are providing roughly $17 billion per year to strengthen food security – a big part of the global effort.
“I’ll turn briefly to the COVID-19 response, which is still underway. The World Bank Group expanded our financing rapidly, reaching $157 billion in the 15 months ending June 2021. Vaccines were a big part of this effort. We now expect to have committed $11 billion to purchase and deploy vaccines in our current fiscal year ending June 30, benefiting 81 countries. This has been a massive effort by our country teams around the world and has brought hundreds of millions of shots to arms.
“Over the next few weeks, I expect to discuss with our board a new 15-month crisis response envelope of around $170 billion to cover April 2022 through June 2023. We expect to commit around $50 billion of this amount in the next three months. This is a continued, massive crisis response given the continuation of the crisis. Helping this effort was the front loading of IDA19. IDA has been a key part of what has been a record scale-up. We’ll be starting IDA20 on July 1, making $93 billion available to IDA countries, the poorest,” stated Mr Malpass.
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Meanwhile, the World Bank is reducing its global growth forecast for 2022 by nearly a full percentage point, to 3.2% from 4.1%, due to the impacts from Russia’s invasion of Ukraine.
Mr Malpass said the biggest component of the bank’s growth forecast reduction was a 4.1% contraction in the Europe and Central Asia region — comprising Ukraine, Russia and surrounding countries.
Forecasts also are being cut for advanced and many developing economies because of spikes in food and energy prices caused by war-related supply disruptions, Malpass said.
“We’re preparing for a continued crisis response, given the multiple crises,” Malpass said. “Over the next few weeks, I expect to discuss with our board, a new 15-month crisis response envelope of around US$170 billion to cover April 2022 through June 2023.”
The plan follows on from a World Bank US$160 billion COVID-19 financing program, of which Malpass said US$157 billion was committed through June 2021.
Malpass said the financing partly will support countries that have taken in refugees from Ukraine and will also help address problems in countries affected by food shortages.
Malpass said World Bank and IMF member countries this week will be discussing new assistance for Ukraine, and expects specific commitments to be announced by a number of donor countries.
