2023-09-18 18:37:56
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To help Benin strengthen private sector-led growth, boost domestic revenue collection, and strengthen social and climate resilience, the World Bank is providing $230 million in financing from the International Development Association (IDA) . The funding was approved on September 15, 2023 in Washington. The aim is to support the country’s growth and social and climate resilience.
What to remember : Benin is ranked 152nd out of 181 countries in terms of extreme climate vulnerability. According to the World Bank, the increase in the frequency of floods has serious consequences on the population and the agricultural sector. “Its rate of coastal erosion, one of the highest in the Gulf of Guinea, threatens more than 50% of the population living in the coastal region, existing key infrastructure and economic activity,” it says in his press release. This is why, in order to help Benin better prepare financially to respond to the immediate needs of natural disasters, this new financing includes an $80 million Disaster Deferred Drawing Option (Cat DDO) that can be fully or partially disbursed in the event of a natural disaster or public health emergency.
Between the lines : Indeed, this first development policy support operation is intended to support reforms favorable to inclusive, resilient growth driven by the private sector. For the institution, the adoption of a new law on public-private partnerships and the implementation of accompanying measures will facilitate the participation of the private sector in public projects and will contribute to attracting private investors to implement projects. public-private partnership projects. The program designed in alignment with the Beninese government’s Action Plan 2021-2026, is based on three pillars. The first pillar supports the establishment of a new public-private partnership (PPP) framework, the creation of a new ecosystem for the development of micro, small and medium enterprises, and the improvement of the investment climate. The second supports reforms to boost national revenue collection, creating fiscal space necessary for public investment and debt sustainability. The third targets reforms aimed at increased social and climate resilience, notably through subsidized medical coverage for poor people, adaptive social protection, and strengthening disaster risk management. According to the head of World Bank operations for Benin, Nestor Coffi, Benin, despite the external shocks recorded in recent years, is on a good growth trajectory. It is essential, from his point of view, for the country to pursue transformational reforms to maintain its growth performance and improve the living conditions of vulnerable populations. “This financing will allow Benin to carry out reforms to rebuild fiscal space, facilitate job-creating investments by the private sector, and strengthen social and climate resilience,” he underlines.
What is the International Development Association (IDA) : The IDA is the World Bank institution that helps the poorest countries on the planet. Founded in 1960, it grants donations and low- or no-interest loans to finance projects and programs likely to stimulate economic growth, reduce poverty and improve the lives of the most deprived. The IDA is among the main donors to the 76 poorest countries on the planet, 39 of which are in Africa. IDA resources help bring positive change to the lives of 1.6 billion people in eligible countries. Since its inception, IDA has supported development activities in 113 countries. The annual volume of its commitments is constantly increasing and has averaged $21 billion over the past three years, with about 61% of this amount going to Africa.
A.T.
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