According to a senior Biden administration official on Monday, US President Joe Biden promised the US will contribute $4 billion to the World Bank’s International Development Association fund for the world’s poorest nations.
The person informed reporters that the US Treasury was spearheading World Bank negotiations for the IDA replenishment and that Biden made the announcement of the three-year US commitment during a closed session of the Group of 20 summit in Rio de Janeiro.
The $3.5 billion Washington pledged in the previous IDA fund replenishment round in December 2021 is significantly less than the latest US contribution, which sets a new record.
As he and entrepreneur Elon Musk, the CEO of SpaceX and Tesla, attempt to reduce US expenditure through a new government efficiency panel, it is uncertain if US President-elect Donald Trump, who has previously suggested reducing international aid, will keep Biden’s promise.
It is unlikely that the US Congress would appropriate funds to support the commitment until after Trump assumes office in January.
A request for comment on the subject was not answered by a representative of Trump’s transition team.”
“Historic” commitment
Biden would make a “historic” commitment to the IDA replenishment, US Deputy National Security Advisor Jonathan Finer told reporters earlier in Rio de Janeiro.
At a briefing on the G20 conference, Finer also informed reporters that Biden will meet with Brazilian President Luiz Inacio Lula da Silva on Tuesday to begin a bilateral sustainable energy agreement.
Every three years, the World Bank replenishes its IDA fund, which primarily offers grants and extremely low-interest loans to the world’s poorest nations. A pledge conference is planned for Seoul on December 5–6.
In light of growing demands from impoverished countries in Africa and beyond that are dealing with crippling debt, natural catastrophes, conflict, and other constraints, World Bank President Ajay Banga is aiming for a record amount that would surpass the $93 billion that was refunded in December 2021.
A $120 billion replenishment is feasible, but achieving that target would necessitate some significant increases in national commitments, Banga told Reuters in October.
The United States’ 2021 contribution was around 14.3% lower than Biden’s new pledge. During the October IMF-World Bank annual meetings, Spain declared its intention to increase its contribution by 37 percent to $423 million.
In September, Denmark declared that its contribution had increased by 40% to almost $492 million.
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