World Bank donors pledge record 25.1 bln usd for poverty fight

from Forbes

WASHINGTON (Thomson Financial) - The world's wealthiest nations have have pledged a record 25.1 bln usd to help overcome poverty in the world's poorest countries, the World Bank announced today.

With the new contributions, the latest funding of the Bank's International Development Association (IDA) will provide a total 41.6 bln usd over three years beginning in 2009. That's an increase of 9.5 bln usd over the previous funding period.

'This represents the largest expansion in donor funding in the IDA's history,' World Bank President Robert Zoellick said in a statement.

The 25.1 bln usd is added to 16.5 bln usd in internal financing from the World Bank Group and prior donor pledges for financing debt forgiveness to make the total of 41.6 bln available for aid.

Treasury Secretary Henry Paulson said the 30 pct increase in the US contribution to 3.7 bln usd 'demonstrates the United States's strong commitment to the poorest countries in the world.'

However, the US lost its number-one donor position in the IDA to the United Kingdom which raised its contribution 50 pct to 4.2 bln usd.

Zoellick praised Britain, the US and other countries for 'stretching' to make more funding available for poverty relief.

IDA is one of the largest sources of assistance for the world's poorest countries, 39 of which are in Africa.

Nearly all of IDA's loans (known as credits) have no interest charge and repayments are stretched over 35 to 40 years, including a 10-year grace period.