The World Bank has announced a $57 billion (Sh5.7 trillion) financing for sub-Saharan Africa, the bulk of which will be used for development.
This follows a meeting of G20 finance ministers, central bank governors and World Bank Group President Jim Yong Kim in Baden-Baden, Germany, on Sunday.
Mr Kim, who is currently on a trip to Rwanda and Tanzania to emphasise the bank’s support for the region, said the money would be disbursed over the next three fiscal years.
He said the bulk of the financing - $45 billion (Sh4.5 trillion) – would come from the International Development Association (IDA), the World Bank Group’s fund for the poorest countries.
Mr Kim said the funding will cover health, education and infrastructure projects such as expanding water distribution and access to power.
“This represents an unprecedented opportunity to change the development trajectory of the countries in the region,” he said.
Priority areas for the private sector investment will include financial markets and agribusiness. The World Bank’s International Finance Corporation (IFC), a private sector arm of the group, will also deepen its engagement in fragile and conflict-affected states and increase climate-related investments.
Expected IDA outcomes include essential health and nutrition services for up to 400 million people, access to improved water sources for up to 45 million and five gigawatts (GW) of additional generation capacity for renewable energy.
The scaled-up IDA financing will build on a portfolio of 448 ongoing projects in Africa totaling about $50 billion (Sh5.1 trillion).
Of this, a $1.6 billion (Sh164 billion) financing package is being developed to tackle the impending threat of famine in parts of sub-Saharan Africa and other regions.
The financing for the region also will include an estimated $8 billion (Sh800 billion) in private sector investments from IFC and $4 billion (Sh400 billion) in financing from International Bank for Reconstruction and Development, its non-concessional public sector arm.
In December, development partners agreed a record $75 billion (Sh7.5 trillion) for IDA, an increase based on an innovative move to blend donor contributions with the World Bank’s internal resources and funds raised through the capital markets.
Sixty per cent of the IDA financing is expected to go to sub-Saharan Africa, home to more than half of the countries eligible for financing.