TOKYO Reuters- Japan pledged $3.4 billion in its largest contribution to the International Development Association IDA of the World Bank in order to help the recovery of low-income countries from the COVID 19 epidemic, finance ministry officials said on Tuesday.
Japan hosted a online meeting on the 20th replenishment of the IDA, brought forward by a year at the initiative of the world's third biggest economy, amid concerns about the lack of funds to boost vaccines and medical systems.
The agenda of the IDA, the largest provider of concessional aid, extends from global health, climate change and natural disasters to debt transparency in developing countries.
The Japanese Finance Minister Shunichi Suzuki said now is the time for global solidarity.
The world continues to face an unprecedented crisis due to COVID 19. We are in danger of losing the achievements towards ending extreme poverty and sharing prosperity. The global economy looks set for solid growth this year and next, but gaps between advanced economies and developing world are seen as waning, undermining efforts to curb extreme poverty.
In October, finance chiefs of the Group of 20 economic powers said they looked forward to an ambitious replenishment of the IDA.
The World Bank hopes to raise more than 90 billion dollars for IDA by the end of the year in a capital-raising exercise every three years.
Japan has a 13.8% stake in a total of $24.9 billion in the form of subscription bonds to be redeemed at IDA's request, a same ratio as in the previous replenishment exercise when its contribution was $3.2 billion.
The amount of $24.9 billion is a core part of the total replenishment, including redemption of loans IDA has offered in the past and bonds it issues to raise funds.
The IDA, which provides loans and grants over very long periods at low interest rates, last increased capital by $82 billion in December 2019.