§ Tony BaldryTo ask the Secretary of State for International Development what recent representations she has received on replacing World Bank loans to the world's poorest countries with grants. [29628]
§ Clare ShortThe US Administration are advocating that the World Bank arm that provides assistance to low-income countries should cease to focus on 40-year highly concessional loans and instead provide at least 50 per cent. grant. This proposal is opposed by all other countries. It would severely deplete the resources available to IDA and undermine the Poverty Reduction Strategy Process, which has led to greatly improved effectiveness in development partnerships in recent years. I have not received any direct representations in support of this proposal, but the issue has been discussed in many forums. The Government of the United States of America have made representations at official level. The UK—along with many other countries that contribute resources to IDA—believes that we should protect and enhance IDA' s existing role as the largest provider of concessional finance to the world's poorest countries and that grant should be provided by bi-lateral donors in a way which complements IDA lending.