Mr.Zoellick's full response to question on the impact of the financial crisis on the World Bank's budget.

QUESTION: What is and will be, perhaps, the impact of the financial crisis on your budget? Is there a growing gap between commitments that have been made by the industrialized world and what is actually coming in, and do you expect that to happen?

MR. ZOELLICK: Okay. We really have three core areas that we operate in, so it works differently.The first, for the poorest, is IDA, which is for the 78 poorest countries. That is done—we either do grants or very long-term credits with minimal or no interest rate. The source of that funding has to be rebuilt every three years through a combination of reflows from some of the prior long-term loans, and for the IDA that we are moving into now, the 15th IDA, we put up $3.5 billion of our own income. We were able to raise, fortunately, pledges for $41.7 billion for that fund over the next three years.

So the key is we need to have countries fulfill their pledges on that, and nobody has suggested that they won’t, but we have to keep pressing. And indeed, this is one of the challenges for the U.S. Congress to flow through on that obligation.

Secondly, you have the IBRD lending which gets the benefit of our AAA borrowing and, using the example that I mentioned, we can borrow at extremely good rates, and we can then help use things like foreign currency swaps and others to help a country manage risk.

So this is not available for the very poorest countries, but it is for some more in the middle-income category. And there, we are not really limited other than by our capital and our ability to borrow, and we are in a very good position. The IBRD has over $40 billion of capital. Last year, we did, if I recall, about $11 or $12 billion of IBRD lending. I could imagine that will go up considerably this year.

Then, the third is IFC, our private sector side, which is not government-guaranteed, and here again—and that is a combination of loans but increasingly, equity, and some 40 percent of that money goes in the last year to the IDA countries, so it can go to the very poorest countries as well. And as I mentioned, we leverage that by not only making our investments but sometimes by syndicating them out. So that area was larger than the IBRD and IDA side, and those three together, combined with about $2.5 billion of the MIGA, which is our political risk insurance, totaled $38.2 billion.

Now, in this coming year, I expect that number will rise, principally because of the additional IBRD lending. So when you ask about the political side, well, we have to make sure people follow through on their IDA pledges. We always welcome more. But in addition, depending on the nature of the problem , we might create trust funds, or we might create special-purpose obligations, so the $1.2 billion Rapid Response Fund--just so you have a sense of how that works--that was created—we took $200 million out of income for pure grants, but in addition, I wanted to fast-track our actions so we could help more quickly, because sometimes our processes take longer. So that was using primarily IDA money and allocating it toward these special needs and circumstances. But we said if countries are willing to contribute to this trust fund, just like we took $200 million in, we can put it to use right away. And I am very proud of my colleagues at the Bank because sometimes the Bank has been slower than one would like. I said we started this in May, and it’s October, and we already have $850 million either done, committed, or in the pipeline. So I am very appreciative of the Australians, and one reason why I have been supporting President Barroso is that he recognized in July that because of high food prices, the Common Agricultural Program wasn’t going to spend all that it had allocated, so he said if he could have one billion euro, which is $1.4 or $1.5 billion, allocated toward these challenges for the poorest farmers or seeds or fertilizers, whether through the World Bank, whether through the World Food Programme, or whether through the FAO, that would be a very, very good use. And just this week, the Development Committee of the European Parliament, passed that. It has to go through the member states, and there is a big debate about whether they should use that or other forms, and I can’t get into their budget procedures, but my message today is let’s not let the financial rescues blind us to the need for the human rescues. So those would be other ways in which we could—we or others—could channel those resources critically where necessary.

Climate Investment Funds—we got a pledge of $6.1 billion about a week ago for funds that we are developing to try to help with low-carbon development . So in addition to the three and four items I mentioned, including MIGA, we are trying to be innovative and come up with additional mechanisms, and those are where we could use the extra funds to help.