International Development Association (IDA) & International Fund for Agricultural Development (IFAD)

The International Development Association, IDA, is the World Bank’s Fund for the Poorest Countries. IDA complements the World Bank’s original lending arm’the International Bank for Reconstruction and Development (IBRD). IBRD and IDA share the same staff and headquarters and evaluate projects with the same rigorous standards.

Established in 1960, IDA aims to reduce poverty by providing loans (called ‘credits’) and grants for programmes that boost economic growth, reduce inequalities, and improve people’s living conditions. IDA provides support for health and education, infrastructure and agriculture, and economic and institutional development to the 81 least developed countries’39 of them in Africa. These countries are home to 2.5 billion people, 1.8 billion of whom survive on $2 a day or less.

IDA lends money on concessional terms. IDA charges little or no interest and repayments are stretched over 25 to 40 years, including a 5- to 10-year grace period. IDA also provides grants to countries at risk of debt distress. In addition to concessional loans and grants, IDA provides significant levels of debt relief through the Heavily Indebted Poor Countries (HIPC) Initiative and the Multilateral Debt Relief Initiative (MDRI).

Since its inception, IDA has supported activities in 108 countries. Annual commitments have increased steadily and averaged about $15 billion over the last three years, with about 50 per cent of that going to Africa. For the fiscal year ending on June 30, 2012, IDA commitments reached $14.8 billion spread over 160 new operations. 15 per cent of the total was committed on grant terms.

During the period 2000-2010

  • IDA provided more than 47 million people with access to a basic package of health, nutrition or population services; immunized more than 310 million children; and provided antenatal care for more than 2.5 million pregnant women.
  • IDA financing helped provide over 113 million people with access to an improved water source.
  • IDA trained more than 3 million teachers and provided more than 105 million children with new or rehabilitated classrooms. IDA financing has supported one of the largest schooling expansions in history, including greatly improved girls’ enrolment.
  • As part of reconstruction efforts following the Hait earthquake, 210,000 children receive daily meals through
  • About one of IDA funding is provided as grants; the rest is in the form of interest-free, long-term credits.
  • IDA is replenished every three years by both developed and developing country donors, as well as two other World Bank organizations’the IBRD and IFC.
  • 52 countries contributed to the last IDA replenishment of $49.3 billion. Former IDA recipients like China, Egypt, Korea and Turkey are now IDA donors.
  • As one of the world’s largest external funders of health, education, infrastructure, and disaster reconstruction and recovery, IDA is critical to achievement of 2015 Millennium Development Goals.
  • IDA helps maximize scarce aid resources. Every $1 of IDA aid leverages, on average, another $2.
  • IDA is an investment in global growth, creating jobs and new opportunities in developed and developing countries.
  • IDA supports country-led development with funds that are predictable and not ‘earmarked’.
  • IDA provides a vital platform to help countries coordinate and target their scarce bilateral and multilateral aid resources across multiple sectors.
  • IDA is recognized as a global in transparency and undergoes the toughest independent evaluations of any international organization.
  • IDA puts a premium on efficiency and effectiveness and was rated ‘best performer’ in terms of aid transparency and ranked first out of 58 donors in the 2011 aid Transparency Index.
  • IDA is overseen by its 170 shareholder countries, creating opportunities for transfer of knowledge and expertise and ensuring a focus on results.

International Fund for Agricultural Development (IFAD)

The International Fund for Agricultural Development (IFAD), a specialized agency of the United Nations, was established as an international financial institution in 1977 as one of the major outcomes of the 1974 World Food Conference. IFAD’s headquarters are located at Rome, Italy. The conference was organized in response to the food crises of the early 1970s that primarily affected the Sahelian countries of Africa. It resolved that ‘an International Fund for Agricultural Development should be established immediately to finance agricultural development projects primarily for food production in the developing countries.’

IFAD is dedicated to eradicating rural poverty in developing countries. Seventy-five per cent of the world’s poorest people ‘1.4 billion women, children and men ‘ live in rural areas and depend on agriculture and related activities for their livelihoods.

IFAD’s goal is to empower poor rural women and men in developing countries to achieve higher incomes and improved food security.

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