Denmark, one of 52 countries funding development projects through the World Bank’s initiative, is urging other countries to join it in tackling the ‘most pressing development and climate challenges’ facing the world today.
Denmark is to almost double its financial commitment to the World Bank’s International Development Association (IDA), the Bank’s fund for low-income countries.
Demonstrating the country’s continued dedication to global development, Denmark’s pledge of DKK 3,300m (€442.5m) represents a 40% rise on its previous contribution.
The announcement comes ahead of IDA’s final 21st replenishment (IDA21) meeting in December, to be held in Seoul, South Korea. The funds are refilled every three years.
Denmark’s announcement follows April’s call from African heads of states calling for an ambitious programme replenishment.
“We all want a more prosperous and equitable world. This financial commitment signifies Denmark’s resolve and dedication in achieving the Sustainable Development Goals and the Paris Climate Agreement.
“I am proud to answer the call from our African partners for more funding,” said Mette Frederiksen, Denmark’s Prime Minister.
“We urge other countries to join forces with us. To act and make the necessary investments. Only together, can we tackle the most pressing development and climate challenges facing the world today.”
What is this programme about?
IDA complements the World Bank’s original lending arm, the International Bank for Reconstruction and Development (IBRD), aiming to fight poverty, boost sustainable economic growth, and improve living conditions in the world’s poorest countries by providing grants and low-interest loans.
Approximately half of the countries receive funding as grants, without being required to repay them, according to the World Bank.
Denmark is one of the 52 high and middle-income countries that fund this initiative, which is also topped up by additional financing raised in the capital markets and complemented by grants from the World Bank.
The previous such package, announced in December 2022 offered a total of $93bn (€83.5bn), $23.5bn of which came from donor countries. This sum has been helping 77 low-income countries’ projects to recover from the impacts of the COVID-19 crisis.
Some of the countries that once needed the IDA’s help and returned as donors include China, Indonesia and Turkey.
“The magic of IDA is not only the lifeline it offers to these countries but its unique capacity to multiply every donor dollar four times. It’s the best deal in development,” said Ajay Banga, President of the World Bank Group.
“This commitment from Denmark will have a tangible impact on people’s lives.”
