The World Bank will tap around $1.5 billion in additional emergency support for Ukraine, with the largest segment — $1 billion — coming from its fund for the world’s lowest-income nations.
The $1 billion has already been approved by representatives of IDA19, the most recent cycle of the bank’s International Development Association, and now needs the final go-ahead from the bank’s board, according to a bank spokesperson.
The World Bank is also seeking approval for $472 million in guarantees backed by the International Bank for Reconstruction and Development, the core fund. The total $1.5 billion would support basic government-funded operations, including paying hospital workers’ salaries.
Why it matters: IDA funds, which are intended for the lowest-income nations, will be allocated for Ukraine despite the country's bank classification as a lower-middle-income economy.
World Bank officials say the institution’s support is only a fraction of the growing needs in Ukraine. The bank estimates that the country’s economy will shrink 45% this year because of the Russian invasion. More than 4.6 million people have been made refugees by the conflict, with millions more displaced inside the country. UNICEF says nearly 5 million children are displaced.
The bank has already mobilized $944 million in emergency financing for Ukraine. If approved, the new $1.5 billion would bring its funding to more than $2.4 billion — out of the $3 billion the bank said it would deliver for Ukraine after the war broke out.
Some of the funding is coming as lending, including low-interest loans known as “credits” from IDA. Other funding takes the form of guarantees from the bank and donors.
Reconstruction: Speaking Tuesday in Poland, which has received more than 2.6 million people who have fled Ukraine, World Bank President David Malpass sounded upbeat on the chances of getting the $1.5 billion approved quickly, along with an additional $100 million for Moldova to support refugees.
Malpass noted that the bank has its roots in the devastation in Europe caused by World War II. “As we did then, we will be ready to help Ukraine with reconstruction when the time comes,” he said.
About the author
Shabtai Gold
Shabtai Gold is a Senior Reporter based in Washington. He covers multilateral development banks, with a focus on the World Bank, along with trends in development finance. Prior to Devex, he worked for the German Press Agency, dpa, for more than a decade, with stints in Africa, Europe, and the Middle East, before relocating to Washington to cover politics and business.
