To Support Reforms and Poverty Reduction
The World Bank has approved supplemental financing of US$16.36 million for the Third Poverty Reduction Support Development Policy Operation (PRSDPO-lll) for Liberia.
This operation will help respond quickly to the country’s urgent needs, generated by the twin shocks of the Ebola and the sustained slump in global commodity prices, in addition to the impact of the withdrawal of United Nations Mission in Liberia (UNMIL).
These factors have worsened the already sharp economic downturn, with severe adverse consequences for employment and fiscal revenues.
“The World Bank Group (WBG) has been an active partner in supporting Liberia through the times of crises. It mobilized financial and technical assistance in close coordination and cooperation with other development partners. The WBG stands ready to further support the Government of Liberia in the effort to transform the economy, make it resilient to shocks and improve the well-being of the Liberian people,” said Larisa Leshchenko, World Bank Country Manager in Liberia.
This supplemental financing for the PRSDPO-lll comprises US$6.5 million International Development Association (IDA) grant, US$5.5 million IDA credit and US$4,366,500 grant from the Liberia Forest Landscape Single Donor Trust Fund provided by the Kingdom of Norway.
This single tranche operation is supplementing the third in a programmatic series of four development policy operations undertaken by the World Bank and is consistent with its Country Partnership Strategy. It will help sustain and deepen the Government of Liberia’s reform efforts in the context of the implementation of the Agenda for Transformation (AfT), which remains the country’s extant medium-term strategy in the wake of the Ebola and commodity price crises.
“The twin shocks and the UNMIL drawdown have intensified fiscal pressures and weakened macroeconomic stability. Beyond the short-term response to the twin shocks, Liberia must undergo through deep institutional, economic and social transformation to address key constraints to sustainable and inclusive growth,” said Marina Bakanova and Daniel Boakye, World Bank Co-Task Team Leaders of the Project.
This supplemental financing will help to protect priority expenditures and to implement reform measures to put the economy on sound footing under a credible macroeconomic framework. “This will not only support the economic recovery and provide jobs but will also be critical for building resilience to future shocks,” they said.
The World Bank’s International Development Association (IDA), established in 1960 helps the world’s poorest countries by providing grants and low to zero-interest loans for projects and programs that boost economic growth, reduce poverty, and improve poor people’s lives. IDA is one of the largest sources of assistance for the world’s 77 poorest countries, 39 of which are in Africa. Resources from IDA bring positive change to the 1.3 billion people who live in IDA countries. Since 1960, IDA has supported development work in 112 countries. Annual commitments have averaged about $19 billion over the last three years, with about 50 percent going to Africa.