World Bank pledges record $3.5b to aid poorest nations

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WASHINGTON, Sept 28 (AFP): The World Bank Thursday pledged a record 3.5 billion dollars to aid the world's poorest countries as it cut the interest rate on loans to big developing countries.
The roughly quarter-point lowering of loan rates was a concession by the World Bank as it stepped up efforts to get some of its bigger borrowers such as China and Brazil to contribute themselves to poverty-fighting programmes around the world.
The compromise marks a major coup for the new president of the troubled bank, Robert Zoellick, a former US trade chief who took office in July after the ouster of Paul Wolfowitz over a favouritism scandal.
Known as a sharp negotiator, Zoellick, who left the Wall Street investment bank Goldman Sachs to join the World Bank, apparently managed to quickly strike a win-win deal to find more money for poor countries and ease borrowing for middle-income clients.
The bank said Thursday it was seeking to contribute more than double the 1.5 billion dollars it had pledged two years ago to the International Development Association (IDA), its arm which provides interest-free loans and grants to the poorest countries.
"By boosting its IDA pledge by over 100 per cent, the World Bank Group is putting its money where its mouth is," Zoellick said.
"This should help us gain momentum as we urge donor countries to increase their commitment to help the 81 poorest countries, especially in Africa," he said in a statement.
Zoellick cited the example of South Africa, which had already pledged an increase of over 30 per cent in its support for IDA.
The bank said its board of executive directors also took "a second important step" Thursday: approval of the biggest simplification and reduction in loan charges in nine years for the International Bank for Reconstruction and Development (IBRD), another key World Bank lending loan unit.