LIMA, October 10, 2015— The Secretary General of the
United Nations and the Presidents of the World Bank Group and the
Islamic Development Bank Group announced today a joint initiative to
scale-up financing in the Middle East and North Africa to help countries
hosting significant refugee populations, countries impacted by
conflict, as well as countries that have significant investment needs to
achieve economic recovery.
“The world today is witness to higher levels of conflict than a
decade ago, and the highest level of forced displacement since the
Second World War,” said United Nations Secretary-General Ban Ki-moon. “The
drivers of violence and instability are more complex and more
intractable than ever. Nothing emphasizes this reality more than...
the
conflicts in the Middle East and North Africa. To address the scale and
the nature of the conflicts, we need new approaches. It is important
that the World Bank, as a close partner to the UN, and other
international financial institutions, mainstream and actively invest in
conflict-affected states.”
The proposed financing initiative consists of two distinct mechanisms
to support countries impacted by conflict and economic slowdown, as
well as those affected by large numbers of refugees and internally
displaced persons:
- Under the first mechanism, guarantees from donor countries would be leveraged in order to issue special bonds, including sukuk or Islamic bonds, to finance economic recovery and reconstruction projects;
- In the second mechanism, grants from donor countries would be used to provide concessional finance to middle income countries of the region hosting the bulk of refugees.
“Strong global partnerships and innovative financing are essential to meet the scale of the need in these hard-hit countries,” said World Bank Group President Jim Yong Kim. “Concerted
action by the international community is vital – otherwise, violence
and conflict will continue to corrode the economies, societies, and
lives of millions of people. It is our collective responsibility to
support the Middle East and North Africa region at this critical time,
and this requires significant resources -- more than any one country or
organization is able to provide on its own.”
The financing initiative was presented at an international
ministerial roundtable on the sidelines of the Annual Meetings of the
World Bank Group and International Monetary Fund. A broad range of
governments and international organizations agreed on the urgent need to
mobilize additional financing for the Middle East and North Africa.
Over 15 million people in the Middle East and North Africa have been
forced from their homes over the past four years due to conflict and
instability, taking an enormous humanitarian and economic toll on the
region. Beyond the human suffering, immense pressures have been placed
on the resources of host countries that were already facing significant
economic challenges. In addition to the immediate costs, estimates to
rebuild the war-torn areas are in the hundreds of billions of dollars.
Even countries not directly affected by conflict have seen their
economies slow down and youth unemployment increase; as a result, those
countries have significant needs to restore economic growth
"History has taught us that it is never too early to plan for post-conflict recovery and reconstruction,” added Islamic Development Bank Group President Ahmad Mohamed Ali Al-Madani. “The
impact of unrest and conflict across the region, including the growing
number of refugees and internally displaced persons, is taking us
outside our comfort zone and is clearly challenging us to act
differently and innovatively, but more importantly, to act collectively
and decisively.”
Meeting participants expressed support for the World Bank Group’s new
strategy for the Middle East and North Africa, which promotes economic
and social inclusion in order to help reinforce peace and stability in
the region. In addition, an agreement was reached for the formation of a
working group to be co-chaired by the United Nations, the World Bank
Group, and the Islamic Development Bank Group. The working group was
asked to finalize the details of the financing mechanisms and develop an
implementation roadmap by February 2016.