Media Teleconference on IDA Robert B. Zoellick President, World Bank Group December 15, 2010 MR. FERGUSON: Hi, this is Alex Ferguson from the World Bank. Thanks for joining us today. World Bank Group President Robert Zoellick will brief you now on today's conclusion of the IDA16 replenishment negotiations in Brussels. He is joined from Brussels by Axel Van Trotsenburg, World Bank Vice President for Concessional Finance and Global Partnerships. And after his statement, Mr. Zoellick will take a few questions. This is a moderated call, so your questions will be answered in turn. When we get to the questions, please identify yourself and your organization before asking your question. Mr. Zoellick's remarks will be on the record, unless other specified. So, without further ado, Mr. Zoellick, please go ahead. MR. ZOELLICK: Thanks, Alex. This is a very important day for the world's 79 poorest countries, and we're very, very pleased with the result. Today, in Brussels, traditional IDA donors, new donors, recent beneficiaries of IDA and the World Bank Group came together to pledge almost $50 billion for an historic IDA replenishment. Three years ago, IDA, the World Bank's fund for the poorest, hit a record level of almost $42 billion. So, today in Brussels, we reached agreement on a new replenishment of $49.3 billion; that's up about 18 percent. This is a very significant accomplishment at a time of tough budget cuts in many donor countries. So, I want to thank all donors, big and small, and thank the staff who worked in an uphill environment. These pledges are also a recognition of IDA's proven track record of results, value for money, and the knowledge that this is the last IDA replenishment before 2015, the target year to achieve the Millennium Development Goals. This agreement also illustrates a new compact we were able to create among our shareholders. IDA donors now number 51; some are new donors, many are graduates from IDA support in the past, and that's one of the best compliments of the work,that they're willing to contribute to something that helped them. In addition, we have some countries that help by prepaying IDA loans back to the World Bank earlier than anticipated. As many of you may know, these loans run about 40 years, but since IDA is a rolling fund, these prepayments are extremely helpful as new contributions and new money. So, it's a way of seeing scaled up, South-South support, which we've been trying to encourage. IDA, as you probably know, is composed of grants and interest-free loans. We've hardened the terms for some countries that are in the transition phase from IDA to IBRD, and we've also made a pledge from our net income of IFC, our private sector arm, and from our revenues of IBRD, as we did last time. So, all told, this is the World Bank Group collective in a cooperative action. I also want to again thank the contributors. It's pretty clear many are stretched at a time of some economic pain at home. In their conversations with us, we got the sense they did so because they and their publics believe in the importance of development. They see that growth and overcoming poverty in the poorest countries also benefits the developed world. Others are passing on the benefits that they themselves received under IDA. They know that this is not charity. It's an investment in peace and progress, and it's also making a difference. Over the last ten years, with an increasing focus on measuring results, we were able to assess that IDA has helped to save about 13 million lives, it's immunized over 310 million children, improved access to water for 100 million people, and every year supported 100 million children going to school, but it's also worked in other areas: supporting judicial reform, important improvements in public financial management and transparency, environmental stewardship and recovery from natural disasters in Aceh, Haiti, and Pakistan. This record IDA replenishment will help improve the lives of over 200 million people, bring healthcare to 30 million people and give access to clean water to 80 million people, among many other areas such as roads and health and education and infrastructure. It will have a special focus on the fragile and conflict-affected states, gender, and climate change. It will also have a robust results framework so we can measure progress and track, so taxpayers and shareholders, clients, and beneficiaries, can see the results of these investments. So, we take this as a very strong vote of confidence, not as an end of an IDA-fundraising process, but as a signal that our shareholders are committed to doing more to help growth and overcoming poverty. I'm heading off today to Zambia and Mali for one last trip before the end of the year, and I suspect this will be very good news for our African colleagues who receive about half the IDA support. So, thank you, and [I'd] be pleased to take any of your questions. MR. FERGUSON: Thanks. And we'll now open it for questions. As I said earlier, can you please identify yourself and your organization before asking your question? OPERATOR: Thank you. At this time, we are ready for the question-and-answer session. If you'd like to ask a question, please press star one; to withdraw your question, please press star two. Once again, to ask a question, please press star one. Our first question, Howard Schneider with Washington Post. Sir, your line is open MR. SCHNEIDER: Thank you. Hi, Bob, thanks for doing this. First question, I hate to be a "homer," but could you tell us how much the U.S. pledged and also give us a sense of some of the new donors who are stepping up this year, and also give us an example maybe on one of the pre-pays. MR. ZOELLICK: Yeah, I wish I could give you more, Howard, but what the donors have agreed--and this has been the process in the past--is that we announce the general numbers, and then we bring back this to our Board in February, and we let each of the individual donors announce, however they wish, their own pledges. So, we don't--we do the aggregate numbers; we don't do the individuals. Just in general, I guess, what I can reference is, trying to put together a broader coalition -- as you would expect, some of the countries that are bigger developing countries that are recent graduates were ones that I think have kicked in with some additional prepayments that's of help. So, this will come out over time, and I'm sorry my hands are tied but, frankly, they've been pretty generous, so I— MR. SCHNEIDER: Fair enough. I assume the recent graduates are perhaps public record. Could you share some of their names? MR. ZOELLICK: I think I tried to hint as far as I could, Howard. [Laughter] MR. SCHNEIDER: All right. All right. MR. ZOELLICK: And again, they can--you know, you can approach them. MR. SCHNEIDER: Yeah, fair enough.Okay. MR. ZOELLICK: Yeah. MR. FERGUSON: Can we have the next question, please. OPERATOR: Our next question, Rebecca Christie with Bloomberg News. You may ask the question. MS. CHRISTIE: Okay. Thanks very much for taking the call. I am looking at the documents from three years ago. I do see some World Bank comments on the biggest donor to the Fund. Certainly, three years ago, it was news that the UK had surpassed the U.S. as the biggest donor. Can you tell us, is that the case again this time? Is the UK the biggest donor? MR. ZOELLICK: Just as with Howard, I'm afraid you've got to back to the major countries and check with them-- MS. CHRISTIE: Well, you guys did announce it last time, though. I mean, this is something that I have coming from the World Bank in a previous-- MR. ZOELLICK: Yeah. No, no, I know what we did. I had to do this last time. But, frankly, each time what we do is we check with the donors on their preferences, and since they're putting forward the money, we allow them--and they've asked that they be able to make their own statements, including--including, I might say, on the relative ranks. MS. CHRISTIE: Okay. Well, also, last time, we had it separated out how much money was actually coming from donors and how much was coming from other sorts of financing. How does that split work out this time? MR. ZOELLICK: Well, it's a little bit more complicated because we have sort of a variety of different funds. What I can tell you are--that our numbers--because, you know, we, from the World Bank side--we pledged about $2 billion from the revenues from IBRD; and IFC, up to about $1 billion. So, that's our direct funds. And then, the other funds, you get some combination of reflows. This time, I think one will see that some of the prepayment numbers increased. And with the overall donors, we've got some additional--we've got more donors, so we'll be able to sort of expand the pool, and they vary. Some have gone up and stretched, some have gone down a little bit, and that's what will come out from their individual numbers. MS. CHRISTIE: Well, okay. But last time the split was $25.1 billion from the donors and $16.5 billion from accounts and previous donations and other things like that. So, can you give us an aggregate split like that? MR. ZOELLICK: I could ask our team if they have the details of that in Brussels. You know, what I kind of have are that, this time around, we got a larger share from some of the innovative things that we've done--and then on top of our own resources. So, that's kind of the general sense I have, but I don't have the particulars, but maybe the Brussels team can share those with you. MS. CHRISTIE: Okay. And are there any governance changes that you guys are committed to as part of this larger funding round? MR. ZOELLICK: The key point is the focus on the results, which is something we've been trying to do, and you can even see in some of these numbers, but this is something that comes through loud and clear in terms of making the case to taxpayers and governments. I think, in addition, we recommended and there was support for a crisis facility that we started to assemble even under the prior IDA but now we are making a regular tool. This is to help with, in part, natural disasters, but also economic calamities. So, we started to use this for Haiti, and I think we're trying to do some special allocation and support for Haiti, again, as well; so, that's a second area. A third one is, in general, there's been an interest in trying to work with the IDA clients, and IDA is different than some other funds. They decide how the funds are used, but we can obviously work them to see if we can encourage certain areas, and one area is gender, another is climate change, and the--also, there is a general interest beyond the crisis fund in seeing what we can do for some of the conflict or post-conflict states. So, you know, IDA's been one of our major tools in addition to a trust fund we operate for Afghanistan. It's been important for the Haitis and the Acehs and the Liberias. So, it fits one of our broader themes of trying to combine development with security and good governance. MS. CHRISTIE: Thank you. MR. FERGUSON: Okay. Can we have the next questioner, please. OPERATOR: Our next question, Alan Beattie, with Financial Times. Your line is open. MR. BEATTIE: Hi, thanks for taking the call. I have a query about this focus on results. I know this is a thing that the Bank and obviously other donors are shifting towards, but in a program like IDA, where you lend over such a long time period and with a lot of other donors involved, how practical is it really to say you can tie particular results to particular grants or particular loans? MR. ZOELLICK: There's a lot of different ways, Alan. You know, we are--and let me give you some of the continuum. You know, we are working some instruments that actually will have pay contingent on performance. So, those are very tied, and some of these may be performance of inputs -- you know, for example, teachers hired -- and some of them we're trying to move further down the scale to, you know, outputs and outcomes. In some of the health areas like malaria and bed nets, it's easier to move those along than in some other areas. So, those are a direct connection of financing with results, on the--with the allocation of funding, indeed. Then, there are similar efforts where, you know, we, with our information technology now, we're getting pretty good, and this is part of our overall “Open Data, Open Knowledge, Open Solutions” initiative in trying to track what comes out of particular sort of projects. Now, it--and so, you're correct. One of the things that IDA has also done is it's often a catalyst for other projects, but we try to distinguish that which comes from our effort but also, where we can, try to measure what is also leveraged from this. So, we think that, you know, we can do some pretty good tracking of this. Obviously, what we work on with donors is sometimes there's exogenous events or extraordinary circumstances that can affect what's happening. I mean, so you may have a healthcare systems initiative and-- what we're finding for healthcare systems is probably one of the best surrogates you can use are things like maternal mortality and infant mortality. So, those relate very closely to the MDGs agenda and, as you know, we work with the UN and others on measuring the MDGs. So, there's no doubt this is a field that people continue to need to refine and figure out the causation elements, but we're also doing some projects, for example--and some other researchers are--where you're basically trying to do versions of controlled experiments, where you sort of try to focus on attention to particular interventions and compare to measuring the general population. So, we can give you more examples on that, Alan, and, you know--and frankly, one of the things that's kind of interesting about some of the geomapping and other things we do, you know, we can allow people to now kind of go down and focus on a country, focus on all the projects in the country and focus on the performance by project. So, some weekend, when you've got it free, you can actually go dig into it yourself. MR. FERGUSON: Okay. Next question. OPERATOR: Our next question, Alessandro Merli, with Il Sole. Your line is open. MR. MERLI: Yes. So, the first question is a clarification of something you said earlier, that larger share is actually coming this year from innovation and World Bank resources. Can you tell us if in absolute terms the money actually put in from donors has gone down or up from the 25 of last time? And the other question is, you mentioned the MDGs and the fact that this will help going towards reaching the MDGs. There's a fair amount of skepticism from the donors community, NGOs, that quite a few of those will be--would be reached. What's your assessment there on this? MR. ZOELLICK: Okay. Well, on the first one, you know, our team may have more of the basic breakdowns, but from sort of what I got overnight, just so you know, there's still some increase for--you know, as you said, the top G--or top 20 donors. Indeed, I think it's also true for even the basic G7. So, they're continuing to have increases, but they're smaller increases than they were before, and some go up and some go down. So, but when you get an 18 percent, almost 20 percent, using SDRs, actually, increase to get at those other numbers, that requires some new donors and trying to get some of the benefits from some of the prepayments and some of the hardened terms. And so, one of the things that was encouraging to us about this was that, in addition to trying to get the traditional donors to stretch, we got some additional absolute contributions from some of the middle-income countries and recent graduates, but we also got some of that agreed and we're willing to do the prepayments in advance, which helps us refund the cycle. So, I don't mean to suggest that the others all went down as a group; they didn't, from what I know. Some individually did go down. As for the MDGs, you know, if you take the first one, which is the global reduction in poverty, that'll probably be--by cutting it in half--that'll probably be achieved, but when you look at the MDGs, you have to disaggregate. And so you've got some very strong numbers that came out of East Asia and South Asia and Latin America. And in Africa, some countries have been able to achieve that, some haven't. Then, if you start to look at some of the other goals, whether they be maternal mortality or infant mortality, again, you--some of the countries will have achieved those more in the East Asia/ Latin America context; in Sub-Saharan Africa, it varies. So, my view on this is that the process is good for getting people to stretch. There are some positive achievements that people have actually hit the goals. Some have gotten closer to the goals. But there's also some important lessons to be learned, and this actually brings you back to IDA. In a world where resources are going to be constrained, if you can have more programs that work off a common platform so you can be more efficient, that can be a real plus. So, one of the dangers in the development field is that people operate in stovepipes. So, you've got the health people, the education people, the nutrition people. If you have a program like school feeding, you can actually help education, you can help the gender numbers, you can often have basic immunizations done there, you can have nutrition. And one of the lessons that we and others are learning with the UN and other parties is, to achieve the MDGs as a group, one needs to try to figure out how one can maximize the benefit of one program. You've probably heard about these conditional cash transfer programs that started out in Mexico and Brazil. We now have these that worked with countries in some--over 40 countries, and the basic model--they vary by country--it's in the Mexican case--is you give money to the poorest people in the village, but in return the children have to go to school and people have to get health check-ups. So, that's probably done more for maternal health than anything in the history of Mexico. So, there you get kind of at least three Millennium Development Goals all related to sort of one focused intervention. So, I wouldn't be discouraged. It's a question of half-full/half-empty, but this IDA funding will clearly give us a chance to work with countries that have fallen short to get closer or to achieve the goals. MR. FERGUSON: Can we have the next question, please? OPERATOR: Our next question, Glen Somerville with Reuters. Sir, your line is open. MR. SOMERVILLE: Good morning, Mr. Zoellick. Two quick questions. One, going into these negotiations, was there any sort of target figure in mind? And then, secondly, and related to that, can you be a little more specific? I think you said, almost 50 billion. The way we work, that could be 46 or it could be 49.8-- MR. ZOELLICK: Yeah, I'm sorry if I wasn't clear. It's 49.3. MR. SOMERVILLE: 49.3. Okay. MR. ZOELLICK: So, it's an 18 percent increase in U.S. dollar terms. MR. SOMERVILLE: Okay. MR. ZOELLICK: And as for targets, in the present economic environment, since we'd had a record increase last time, we wanted to at least make sure that we had--I think the actual number last time was 41.7, but we said about 42, and if we could do better given the economic challenges that a lot of the poor countries are facing, we want to do better. So, I'm very pleased that we've hit 49.3 or almost 50. MR. FERGUSON: Okay. We have time for one more question, and then we'll have to finish. Is there one more? OPERATOR: No, no further questions. MR. FERGUSON: Okay. Well, thank you very much, that's the end of the call. Thank you for joining. Good-bye. MR. ZOELLICK: Yeah, thanks [to] all of you for joining us. Appreciate it. Bye. [End recorded session.] |
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