[World Bank] President Robert B. Zoellick today launched two multi-billion infrastructure investment initiatives to help developing countries withstand the global financial and economic crisis.
The World Bank’s Infrastructure Recovery and Assets (INFRA) platform and the Infrastructure Crisis Facility (ICF), set-up by IFC, the World Bank Group’s member focused on private sector investments, will together mobilize more than US$55 billion over the next three years to infrastructure projects in developing countries. Out of this total, US$45 billion is available in lending from the World Bank and US$10 billion is available via IFC. The two initiatives will help to create jobs and lay the foundations for future economic growth and poverty reduction.
As founding partners in the ICF, the German and French governments today were the first to sign a Memorandum of Understanding with the World Bank Group with the intention to contribute €500 million (about US$660 million) through Germany’s development bank KfW and €1 billion (around US$1.3 billion) through France’s development bank Proparco.
The ICF is expected to attract more than US$10 billion to help bridge the gap in available financing for viable, privately-funded or public-private partnership infrastructure projects in emerging markets. IFC will contribute up to US$300 million in equity and may provide as much as US$2 billion in loan co-financing.
Germany’s Development Minister Heidemarie Wieczorek-Zeul said: "As sources of funding dried up, infrastructure projects in developing countries have been left high and dry. And yet, they are needed as key elements of development in order to achieve the Millennium Development Goals. Services such as water and sanitation, energy, transport and telecommunications are vital in the fight against poverty. For this reason our government has included infrastructure financing in developing countries in its second economic stimulus package."
France’s Finance Minister Christine Lagarde said: "These private-public partnerships in the infrastructure sector are a key component not only of the immediate response to the crisis but also of long-term economic growth. Through the signing of this agreement, France is actively taking part in this effort by providing a €1 billion contribution as well as its longstanding expertise in the sector. "
World Bank Group Launches Multi-Billion Infrastructure Initiatives to Help Developing Countries Weather Crisis