Norwegian Government proposes increased support for World Bank’s International Development Association, IMF’s Catastrophe Containment and Relief Trust and lending schemes for low-income countries
Published under: Solberg's Government
Publisher Ministry of Foreign Affairs
Press release | Date: 12/05/2020 | Ministry of Finance
‘We must protect those who are most vulnerable, and prevent today’s health crisis from becoming tomorrow’s hunger disaster and social crisis,’ said Minister of International Development Dag-Inge Ulstein.
In order to strengthen international cooperation to mitigate the impacts of the coronavirus crisis, the Government is proposing a contribution to the IMF’s Catastrophe and Containment Relief Trust and contributions to the IMF and World Bank lending schemes for low-income countries.
The Government is proposing an increase in Norway’s core contribution to the International Development Association (IDA), the part of the World Bank that provides assistance to the world’s 76 poorest countries. Over half of these countries are in Africa. This will be additional to Norway’s contribution to the 19th IDA replenishment for the period 2020-22, which amounts to NOK 976 million in 2020.
‘The World Bank and IDA responded quickly to the Covid-19 outbreak by freeing up substantial resources. I am very pleased that we are now able to increase our core contribution to IDA by a further NOK 102 million in 2020. This will strengthen IDA’s efforts to alleviate the consequences of the pandemic, by providing immediate and long-term support to shore up the health systems in these countries,’ said Minister of International Development Dag-Inge Ulstein.
International efforts are needed to address the economic crisis, which is hitting low-income countries particularly hard. Targeted measures to strengthen the Covid-19 response in the poorest countries are vital. The IMF’s Catastrophe Containment and Relief Trust (CCRT) provides grants for debt relief for the poorest and most vulnerable IMF member countries if they are hit by catastrophic natural disasters or public health disasters. Debt relief under the CCRT frees up resources that can be used to deal with acute crises.
‘A substantial Norwegian contribution of NOK 180 million to the IMF’s Catastrophe Containment and Relief Trust will provide relief on debt service payments for the poorest countries and put them in a better position to deal with the Covid-19 pandemic,’ Mr Ulstein said.
The Government has also proposed increasing Norway’s contribution to the IMF’s special lending schemes for low-income countries by NOK 5.6 billion.
‘The IMF’s concessional lending schemes for low-income countries provide support for the poorest and most vulnerable countries. Many of these have been hit hard by the coronavirus crisis. IMF’s lending schemes can be used to help keep the economies in these countries afloat while the pandemic rages, and to stimulate renewed growth once the acute crisis dies down,’ said Minister of Finance Jan Tore Sanner.
‘Development efforts and the work being done by the UN, the IMF and the World Bank and other key organisations to coordinate the response are vital in tackling the pandemic and its long-term consequences,’ said Mr Ulstein.