103989


                           Enhancing IDA’s Financial Support in IDA17
                                          Chair Summary*
                                           March 8, 2016


        Executive Directors considered and approved an increase in IDA17 commitment authority
by US$5.0 billion as recommended in the President’s Memorandum (IDA/R2016-0019/1). They
also approved recommendations to: (i) establish the US$3.9 billion IDA17 Scale-up Facility
(SUF), on non-concessional terms on a one-off basis; (ii) increase the Single-Currency Lending
program from SDR3.0 billion to SDR7.0 billion; (iii) allocate US$900 million to replenish the
Crisis Response Window (CRW); and (iv) allocate US$200 million to provide, on an exceptional
basis, concessional lending to Jordan and Lebanon. Executive Directors also approved an
expansion of the eligibility criteria for accessing the CRW and the introduction of a minimum base
yearly allocation in the Turn-Around Regime of SDR4.0 million.

        In the context of a gap between a large demand and a constrained supply of resources
during the IDA17 period, Directors welcomed the innovative approach of the SUF to enhance IDA
financing capacity by providing additional lending to IDA countries on non-concessional terms.
They emphasized that the allocation of these non-concessional resources should target high-impact
projects that foster economic transformation and resilient, inclusive growth and incorporate
countries’ current economic constraints and debt sustainability considerations. Directors also
underscored the importance of country implementation capacity, and that SUF-financed projects
should advance WBG goals and IDA17 priorities. They noted the importance of allocating
adequate budgetary resources for quality and impactful projects under the SUF. Two Directors
asked management to further explore options for providing SUF funding with variable and fixed
interest rate options.

       Directors strongly supported the proposal to replenish the CRW in order to ensure
additional funding could be made available to clients during IDA17 to provide rapid response in
the event of further crises, and agreed that any unused funds in the CRW as of end-FY17 should
be carried over for utilization under the CRW during IDA18. Directors also welcomed an
expansion of the eligibility criteria for the CRW to include public health emergencies and
epidemics and the introduction of a minimum base allocation in the Turn-Around Regime. They
expressed interest in assessing the effectiveness of the CRW at the end of IDA17.

        Taking note of the urgent and difficult circumstances in Jordan and Lebanon borne of the
Syrian refugee crisis, Directors welcomed the Bank’s initiative to provide IDA support on an
exceptional basis to alleviate strains on both countries, which would supplement other financing
mechanisms being developed. Directors underscored the need to ring fence the IDA assistance to
Jordan and Lebanon and not view it as a precedent, stressing that IDA resources are intended for
the poorest countries. They also stressed the importance of maximizing the benefits to refugees
and the poorest. Directors urged management to develop a more systematic response and
mechanisms for IBRD and IDA to respond to future crises. Directors noted that World Bank
shareholders and management would commit to compensate IDA for the forgone income related
to the concessionality of the US$200 million allocated to Jordan and Lebanon and would review
options for doing so. Two Directors would have preferred for the lending to Jordan and Lebanon
to be provided by IBRD, incorporating an externally-financed concessional element.

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*This summary is not an approved record