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Grants and concessionality in IDA13 (الإنجليزية)

This note explores ways in which IDA's use of grants and increased concessionality of its lending terms could be framed. Its purpose is to seek consensus among donors in the context of the IDA13 replenishment. It sets out the possibilities of addressing the issue along two dimensions -- functionality of the use of grants, and concessionality of IDA's operations. The note then looks at possibilities for combining grant activities for specific purposes and introducing additional concessionality on IDA credits. Expanding on an idea put forward in Paris, such combinations could be explored on the basis of both sectoral and country needs. Finally it provides an estimate of the financial costs to IDA. The functional areas where grants could increase IDA's effectiveness as a development institution should underpin the use of grants in IDA's operations. The IDA Deputies' discussion in Paris indicated varying levels of support for different functional uses of grants in this context. Post conflict, including in UN administered territories, was most strongly supported, followed by grants for communicable disease control, especially for regional programs, natural disasters, capacity building and education. In terms of volume, some donors were in favor of relatively large amounts of grants, while others felt grants should remain a small part of IDA's operations. On the whole, the sense was that the use of grants should be constrained, with several donors focusing on a 10% figure.


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