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World Bank: International Development Association

Volume 697: debated on Monday 17 December 2007

asked Her Majesty's Government:

When decisions are taken on contributions to the World Bank International Development Association (IDA), what consideration is given to the decision-making process the World Bank uses to allocate funds from the IDA to recipient countries; and [HL768]

Whether consideration is given to the import placed on environmental sustainability in the World Bank's country policy and institutional assessment tool when it decides on contributions to the International Development Association. [HL769]

The latest replenishment of the International Development Association (IDA) is about to conclude. The UK, together with other donors, will agree the level of funding and a policy framework. During this replenishment, discussion has focused on country-level effectiveness, fragile states and IDA's role in assisting countries to tackle climate change.

We consider a number of factors in deciding funding to IDA. These factors include IDA's effectiveness in reducing poverty which in turn is linked to IDA's allocation system, known as the performance-based allocation system—PBA. Each year IDA allocates the bulk of its resources using the PBA. The PBA gives weight to both the needs and performance of all countries that are eligible to receive assistance from IDA. A country's performance is measured by the country policy and institutional assessment—CPIA. Environmental sustainability is one of 16 criteria in the CPIA.

The IDA negotiations in 2007 have (a) reaffirmed the centrality of IDA's allocation system; (b) simplified the system to make it more transparent; (c) discussed the link between allocations and country-level outcomes; and (d) confirmed that more IDA resources are being directed to countries where results are being achieved.