WASHINGTON, April 25, 2009: World Bank Group President Robert B. Zoellick Saturday launched two multi-billion infrastructure investment initiatives to help developing countries withstand the global financial and economic crisis.
The World Bank’s Infrastructure Recovery and Assets (INFRA) platform and the Infrastructure Crisis Facility (ICF), set-up by IFC, the World Bank Group’s member focused on private sector investments, will together mobilize more than 55 billion US dollar over the next three years to infrastructure projects in developing countries.
Out of this total, 45 billion US dollar is available in lending from the World Bank and 10 billion US dollar is available via IFC. The two initiatives will help to create jobs and lay the foundations for future economic growth and poverty reduction.
As founding partners in the ICF, the German and French governments Saturday were the first to sign a Memorandum of Understanding with the World Bank Group with the intention to contribute 660 million US dollar through Germany’s development bank KfW and 1,3 billion US dollar through France’s development bank Proparco.
– As developing countries are facing the trials of the global economic crisis, it is vitally important that economic stimulus packages in the developed world are accompanied by support to those that cannot afford multi-billion bailouts, said Zoellick, in launching the new initiatives. – A decline in infrastructure leaves weaker foundations for long-term economic growth that hits the poorest the hardest. We have a chance to avoid the errors of the past and scale up financing and help countries identify critical investments.
The global financial crisis has depressed investments in infrastructure projects, particularly in developing countries. The total yearly financing gap for infrastructure investments (including maintenance) in developing countries could range from 140-270 billion US dollar, depending on GDP growth scenarios.
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