Recognizing the unique and perplexing challenges posed by fragile and conflict-affected countries, the World Bank has identified this as one of its six strategic themes for achieving inclusive and sustainable globalization. One of the first steps taken to advance this agenda was the creation of a new trust fund to catalyze the Bank’s work, the State and Peace-Building Fund (SPF). Approved by the Bank’s Board of Directors in April 2008, the overall goal of the SPF is to address the needs of state and local governance, and peace-building in fragile and conflict-prone and conflict-affected situations.
The SPF has two main objectives:
1. Support measures to improve governance and institutional performance in countries emerging from, in, or at risk of sliding into, crisis or arrears.
2. Support the reconstruction and development of countries prone to, in, or emerging from
As an operational tool in support of World Bank country strategies, the SPF aims to scale up Bank engagement in client countries, enable cross-cutting, innovative approaches, and foster strategic partnerships for greater impact. Grants provided by the Fund should contribute to harmonized multi-donor approaches whenever possible, capture and disseminate the lessons of its activities to promote a better understanding of fragility and conflict dynamics, and of effective strategic and operational approaches to engagement in fragile and conflict situations.
In creating the Fund, the Board of Directors committed to the provision of US$100 million from the Bank’s own administrative budget for the period FY09-FY11. The first donor contributions to the SPF have come from the Governments of the Netherlands and Norway. Several other bilateral donors have expressed significant interest and are likely to contribute. The SPF is managed by the Fragile and Conflict-Affected Countries Group in the Operational Policy and Country Services Vice Presidency of the World Bank.
The SPF replaces the Post-Conflict Fund (PCF) and the LICUS Trust Fund (LICUS TF) which have been operational since 1998 and 2004, respectively. In doing so, it consolidates the Bank’s strategic approach to fragility and conflict, and streamlines related procedures. Replacing the two separate, but interrelated, special-purpose trust funds with a single, conceptually integrated trust fund emphasizes the Bank’s belief that conflict and fragility cannot be seen through separate lenses. The PCF and LICUS trust funds are no longer receiving contributions, and they are scheduled to close on December 31, 2011. This closing date has been set in order to allow active projects to be completed.