World Bank senior managing director visits Nepal

The World Bank’s senior managing director Axel van Trotsenburg arrived in Kathmandu today on his first official visit to Nepal, to meet with government and other stakeholders and chair the Third Replenishment meeting of the World Bank’s fund for low-income countries, the International Development Association (IDA).

As part of his five-day visit, today, Trotsenburg met with Prime Minister Pushpa Kamal Dahal, finance minister Barsha Man Pun, chief secretary Baikuntha Aryal, and development partners.

Trotsenburg will chair the Third IDA21 Replenishment meeting hosted by the government in Kathmandu on June 18-21. The International Development Association (IDA) is the part of the World Bank that helps the world’s low-income countries.

In 2024, IDA is working with donors and borrowing countries to replenish resources that will be used to deliver on global development goals. IDA21-- the 21st replenishment round since 1960 -- will work to end poverty on a livable planet.

The four-day IDA21 meeting in Kathmandu will bring together officials from 65 donor governments and representatives of borrowing member countries who will discuss the proposed IDA21 policy focus areas--people, planet, prosperity, infrastructure, and digitalisation. They will also look at financing scenarios, the level of donor contributions required to support these scenarios and assess the financing needs of countries supported by IDA.

Trotsenburg will also visit the IDA-financed Earthquake Housing Reconstruction Project in Rabiopi in Bagmati Province as part of the replenishment meeting.

The Third IDA21 Replenishment meeting will also be attended by other senior World Bank Group officials, including World Bank managing director for Operations Anna Bjerde and managing director and World Bank Group chief financial officer Anshula Kant.

Developing countries pay record $443.5 billion on public debt

Amid the biggest surge in global interest rates in four decades, developing countries spent a record $443.5 billion to service their external public and publicly guaranteed debt in 2022, the World Bank’s latest International Debt Report shows.

The increase in costs shifted scarce resources away from critical needs such as health, education, and the environment. "Debt-service payments—which include principal and interest—increased by five per cent over the previous year for all developing countries," the report reads, adding that the 75 countries eligible to borrow from the World Bank’s International Development Association (IDA) — which supports the poorest countries—paid a record $88.9 billion in debt-servicing costs in 2022. "Over the past decade, interest payments by these countries have quadrupled, to an all-time high of $23.6 billion in 2022."

"Overall debt-servicing costs for the 24 poorest countries are expected to balloon in 2023 and 2024—by as much as 39 per cent," the report finds.

“Record debt levels and high interest rates have set many countries on a path to crisis,” said the World Bank Group’s chief economist and senior vice president Indermit Gill. "Every quarter that interest rates stay high results in more developing countries becoming distressed—and facing the difficult choice of servicing their public debts or investing in public health, education, and infrastructure," he said, adding that the situation warrants quick and coordinated action by debtor governments, private and official creditors, and multilateral financial institutions—more transparency, better debt sustainability tools, and swifter restructuring arrangements. "The alternative is another lost decade."

Surging interest rates have intensified debt vulnerabilities in all developing countries. In the past three years alone, there have been 18 sovereign defaults in 10 developing countries—greater than the number recorded in all of the previous two decades. Today, about 60 per cent of low-income countries are at high risk of debt distress or already in it.

Interest payments consume an increasingly large share of low-income countries’ export, the report finds. More than a third of their external debt, moreover, involves variable interest rates that could rise suddenly. Many of these countries face an additional burden: the accumulated principal, interest, and fees they incurred for the privilege of debt-service suspension under the G-20’s Debt Service Suspension Initiative (DSSI). The stronger US dollar is adding to their difficulties, making it even more expensive for countries to make payments. Under the circumstances, a further rise in interest rates or a sharp drop in export earnings could push them over the edge.

As debt-servicing costs have climbed, new financing options for developing countries have dwindled. In 2022, new external loan commitments to public and publicly guaranteed entities in these countries dropped by 23 per cent to $371 billion—the lowest level in a decade. Private creditors largely abstained from developing countries, receiving $185 billion more in principal repayments than they disbursed in loans.

That marked the first time since 2015 that private creditors have received more funds than they put into developing countries. New bonds issued by all developing countries in international markets dropped by more than half from 2021 to 2022, and issuances by low-income countries fell by more than three-quarters. New bond issuance by IDA-eligible countries fell by more than three-quarters to US$3.1 billion.

With financing from private creditors drying up, the World Bank and other multilateral development banks stepped in to help close the gap. Multilateral creditors provided $115 billion in new low-cost financing for developing countries in 2022, nearly half of which came from the World Bank. Through IDA, the World Bank provided $16.9 billion more in new financing for these countries than it received in principal repayments—nearly three times the comparable number a decade ago. In addition, the World Bank disbursed $6.1 billion in grants to these countries, three times the amount in 2012.

The latest International Debt Report marks the publication’s 50th anniversary. It highlights key insights from the World Bank’s International Debt Statistics database—the most comprehensive and transparent source of external debt data of developing countries. The new edition also features an expanded analytical framework, one that goes beyond the latest data to examine near-term outlook for debt as well. It also includes an overview of the Bank’s debt-related activities and an analysis of emerging trends in debt management and transparency.

“Knowing what a country owes and to whom is essential for better debt management and sustainability,” said Haishan Fu, Chief Statistician of the World Bank and Director of the World Bank’s Development Data Group. “The first step in avoiding a crisis is having a clear picture of the challenge. And when problems arise, clear data can guide debt restructuring efforts to get a country back on track towards economic stability and growth. Debt transparency is the key to sustainable public borrowing and accountable, rules-based lending practices which are so vital to ending poverty on a livable planet.”

The report notes that IDA-eligible countries have spent the last decade adding to their debt at a pace that exceeds their economic growth—a red flag for their prospects in the coming years. In 2022, the combined external debt stock of IDA-eligible countries hit a record $1.1 trillion—more than double the 2012 level. From 2012 through 2022, IDA-eligible countries increased their external debt by 134 per cent, outstripping the 53 per cent increase they achieved in their gross national income (GNI).

Government and World Bank sign $120 million concessional loan financing agreement and $19.7 million grant agreement to strengthen school sector

The government and the World Bank today signed a financing agreement for $120 million concessional loan from the International Development Association (IDA) and a grant agreement for $19.7 million from the Global Partnership for Education for the School Sector Transformation Programme (SSTP) Operation, which support the implementation of the government’s flagship School Education Sector Plan.

The agreement was signed by finance secretary Arjun Prasad Pokharel and the World Bank country director for Maldives, Nepal, and Sri Lanka Faris Hadad-Zervos at the Finance Ministry.

The operation focuses on improving foundational skills by implementing the national integrated curriculum in early grades, a press note issued by the World Bank reads. "The operation supports the government’s programme through the development and implementation of the Recovery and Accelerated Learning Plan to address learning losses as a result of school closures due to Covid-19 and other disasters, strengthening teaching and learning in the classrooms, construction of green and resilient classrooms, ensuring minimum enabling conditions such as qualified teacher, child-friendly taps and seating, and toilets in the early childhood education development centers, and strengthening digital teaching and learning materials, among others," it reads, adding that the operation also envisions improving the equity of the school sector by supporting girls, disabled students, and those of lower socio-economic status, through targeted scholarships programmes.

“I am hopeful that the reform agenda envisioned in the School Sector Transformation Programme will be instrumental in increasing equitable access and improving the quality of education, which are critical for human capital development,” said finance secretary Pokharel after signing the agreement.

“The School Sector Transformation Programme operation supports the government of Nepal’s Green, Resilient, and Inclusive Development (GRID) agenda by investing in quality and equitable access to education, which is key to developing human capital and fostering inclusive and resilient growth,” said World Bank country director for Maldives, Nepal, and Sri Lanka Faris Hadad-Zervos, after signing the pact.

Public debt doubles in five years

 The public debt has been doubled in the last five years, coinciding with the first tenure after Nepal became a federal republic.

The significant increase has been recorded since the 2017 elections, when the full-fledged federal government came to power, with seven provincial and 753 local governments. However, the federalism has little contribution in whooping increase in public debt compared to lack of good governance and fiscal discipline.

According to Public Debt Management Office, the ratio of public debt to GDP is 41.38 per cent. "The ratio of external debt to total GDP is 21.64 per cent, whereas the ratio of internal debt to total GDP is 19.73 per cent."

Nepal's GDP is currently valued at Rs 4,851 billion, according to the Central Bureau of Statistics (CBS).

In the fiscal year 2017-2018, Nepal had around Rs 917 billion public debt. But the amount has steadily increased to Rs 1,048 billion in 2018-19; Rs 1,433 billion in 2019-20; Rs 1,737 billion in 2020-21, and finally reaching to Rs 2,013 billion in the last fiscal year 2021-22, according to the Public Debt Management Office data.

As of the first quarter of the current fiscal year 2022-23, the country’s public debt totals to Rs 2,007.84 billion.

Among, the public debt, the external and domestic debt are almost equal.

The external debt stands at Rs 1,050.23 billion, while domestic debt is at Rs 957.61 billion, according to the data.

The debt, however, decreased by 0.27 per cent as of mid-October, compared to the Rs 2,013.29 billion recorded in mid-June. "The external debt increased by Rs 24.38 billion during the first quarter of the current fiscal year, whereas domestic debt decreased by Rs 29.83 billion," the data revealed.

The government has received Rs 24.70 billion in debt from development partners, in the first three months of the current fiscal year. However, it has not mobilised domestic debt yet, but preparing.

The government has cleared a total of Rs 5.84 billion (approximately $51 million) external loans in the first quarter of the current fiscal year 2022-23. But the liability of foreign loans increased by Rs 5.52 billion due to depreciation of Nepali currency against the US dollar, according to the office.

Top 10 Creditors

International Development Association (IDA) -- Rs 526.18 billion

Asian Development Bank (ADB) -- Rs 323.64 billion

Japan International Cooperation Agency (JICA) -- Rs 48.41 billion

International Monetary Fund (IMF) -- Rs 43.89 billion

EXIM Bank Line of Credit-India -- Rs 37.56 billion

Exim Bank of China -- Rs 33.51 billion

International Fund for Agricultural Development -- Rs 10.25 billion

OPEC Fund for International Development -- Rs 8.38 billion

Exim Bank, Korea -- Rs 5.62 billion

European Investment Bank (EIB) -- Rs 5.61 billion

IFC ramps up impact investments in South Asia to protect jobs and livelihoods, drive green recovery

 In a bid to protect the most vulnerable people and help companies maintain operations and jobs, IFC's focused and sustained investments in South Asia continued to have strong impact in the fiscal year 2021, with support for medical facilities, vaccines and supplies, and to hard-hit micro, small, and medium enterprises (MSMEs) while also spurring investments in renewable energy, affordable housing, and distressed assets resolution.

In the midst of a difficult year with massive and ongoing social and economic disruptions caused by Covid-19, IFC committed over $3.8 billion, including mobilisation and short-term finance, in South Asia as of June 2021 — resulting in a record investment volume of over $14.9 billion in the last five years in the region, towards a green, inclusive, and resilient recovery.

In India, IFC’s largest client country globally, total commitments at the end of June stood at $1.7 billion representing an increase of over 51 per cent from last year, according to a press note issued by the IFC today. "Likewise, in Bangladesh, IFC made total commitments of $791 million, an increase of almost 33 per cent from last year."

"The Covid-19 crisis has drastically impacted the region’s private sector, which has severely affected the region’s most vulnerable people," IFC's vice president for Asia and the Pacific region Alfonso Garcia Mora said, adding that Covid-19 has laid bare the region’s existing vulnerabilities in the financial sector, disrupting businesses -- particularly micro, small, and medium enterprises -- and leaving so many people exposed. "That’s why we’ve focused our attention on supporting moves to improve resilience on multiple fronts, as all indications are that the road to recovery will be long."

IFC has committed $590 million in Covid-response deals in South Asia -- with additional deals worth over $100 million in the pipeline. IFC’s fast-track financial support has helped clients across sectors at a time when the economic fallouts of the pandemic have severely impacted market sentiment. Further, IFC committed $353 million in climate finance and $490 million in IDA/FCS (International Development Association/Fragile and Conflict-Affected Situations) countries in the region.

IFC already provided financing and advisory support for the production of critical pharmaceutical products and medical equipment such as personal protective equipment (PPE) and vaccines, the press note reads, adding that IFC will further focus on providing much needed liquidity to private sector companies in the region so they can maintain operations, preserve, and create jobs.

"The impact of the pandemic coupled with the region’s vulnerability to climate change, has highlighted the need for a collaborative, resilient and climate friendly recovery that can withstand future shocks,” IFC’s new regional director for South Asia Hector Gomez Ang said, adding that it is especially important for South Asia, which is home to three of the top five countries in terms of vulnerability to climate change globally.

While South Asia is one of the fastest growing regions in the world, estimates suggest that climate impacts could reduce its annual gross domestic product by an average of 1.8 per cent by 2050, rising to 8.8 per cent by 2100, if the countries fail to take adequate measures. The region is also estimated to have an untapped climate investment potential of $3.4 trillion by 2030.

Under the World Bank Group’s Climate Change Action Plan (2021-2025), IFC has committed to aligning all new real sector operations with the objectives of the Paris Agreement by July 1, 2025 and set the target of reaching 35 per cent financing for climate on average over the next five years. In addition, IFC will intensify its effort to create bankable investment opportunities and to mobilize private financing towards decarbonising five key sectors as outlined in the CCAP.

Nepal to get 4 million doses of Moderna vaccines through Covax

 Nepal is the second country globally to have completed agreements with GAVI to procure 4 million doses of Moderna vaccines, financed by the World Bank, through the Covax cost-share option, according to a press note issued by the World Bank. "This will diversify and strengthen the country’s Covid-19 vaccine portfolio."

"Nepal is an early mover in utilising the Covax cost-share scheme, and I am pleased to note that we have finalised an arrangement, despite very challenging circumstances, to bring safe and highly effective vaccines to Nepal,” said minister of state for Health and Population Umesh Shrestha. "Moderna vaccines have helped expand options for vaccinating Nepalis above 12 years of age and fast-track Nepal’s progress towards a safer post-Covid world."

Delivery of these vaccines is expected to start by March 2022 and will contribute to Nepal’s goal to vaccinate at least 72 per cent of its population, as well as children 12-17 years of age for whom the Moderna vaccine is deemed safe and effective.

“We are honoured to support the people and government of Nepal, along with our development partners, by financing the purchase of safe and effective vaccines through the Covax facility,”  World Bank country director for Maldives, Nepal, and Sri Lanka Faris Hadad-Zervos said, adding that it is a key element of World Bank's overall Covid response by helping to meet emergency health needs and strengthening the healthcare and vaccine delivery system.

The World Bank has made available $104 million to support Nepal’s health response to the pandemic, with $67.5 million earmarked to purchase and deploy Covid-19 vaccines. Last month, 1,000 oxygen concentrators were brought in through the project while seven oxygen generation plants are being established, one in each province. These will help strengthen health preparedness in the event of future waves of the pandemic.

"We commend the government of Nepal for being the first country in South Asia, and one of the first in the world, to join and tap into the Covax cost-share option,” said World Bank vice president for South Asia Hartwig Schafer. "The World Bank is committed to continuing our support to Nepal’s Covid-19 vaccination programme, which is critical to helping the people and economy of Nepal build back better from this unprecedented crisis."

The World Bank supports countries’ Covid-19 vaccine implementation plans. Countries make choices based on their specific needs and the World Health Organisation (WHO) recommended policy and guidelines on vaccines, therapeutics, and other tools they adopt. As the threshold for eligibility for IBRD/IDA resources in vaccine purchase, the bank accepts as eligible for inclusion in the project Covid-19 vaccines that (i) have received regular or emergency licensure or authorisation from at least one of the Stringent Regulatory Authorities (SRAs) identified by WHO for vaccines procured and/or supplied under the Covax Facility, as may be amended from time to time by WHO; or (ii) have received WHO Prequalification or WHO Emergency Use Listing. The Moderna vaccine meets these criteria.

Since the start of the Covid-19 pandemic, the World Bank Group has deployed over $157 billion to fight the health, economic, and social impacts of the pandemic, the fastest and largest crisis response in its history. The financing is helping more than 100 countries strengthen pandemic preparedness, protect the poor and jobs, and jump start a climate-friendly recovery. The bank is also supporting over 50 low- and middle-income countries, more than half of which are in Africa, with the purchase and deployment of Covid-19 vaccines and is making available $20 billion in financing for this purpose until the end of 2022.

Nepal receives $75 million for Covid-19 vaccines and stronger response to pandemic

 The World Bank’s Board of Executive Directors today approved $75 million from the International Development Association (IDA) to support access to safe and effective Covid-19 vaccines and equitable vaccine distribution by strengthening Nepal’s health and vaccination system. The financing is expected to facilitate vaccination of at least one-third of the population through an equitable distribution plan.

"The pandemic presents immense challenges and an uncertain environment, particularly in the purchase, supply and distribution of vaccines," World Bank country director for Maldives, Nepal, and Sri Lanka Faris Hadad-Zervos said, adding that it is a testament to the development partner's strong partnership with Nepal that the World Bank has been able to move quickly to support the government’s ambitious plans to vaccinate at least 72 per cent of the population.

The additional financing builds on the $29 million for the original Covid-19 Emergency Response and Health Systems Preparedness Project that was approved in April 2020, the existing World Bank-supported health programmes, and confirmed support of other development partners in the context of the government’s overall Covid-19 response.

Most of the new financing (90 per cent) will go to the purchase of Covid-19 vaccines and deployment for prioritised populations beyond the 20 per cent that will be vaccinated through COVAX. "The rest of the financing will help strengthen the health system to support the Covid-19 vaccination effort and procure other Covid-19-related supplies such as diagnostic tests, laboratory equipment and therapeutics, according to the press note. "The additional financing also supports community engagement and risk communication, and strengthening existing digital technology-based pandemic data, surveillance and monitoring systems."

"This support is critical for Nepal to safeguard the physical health of its people and economic health of the nation,” said World Bank practice manager for South Asia for the Health, Nutrition and Population Global Practice Gail Richardson. "Providing fast and fair access to the approved Covid-19 vaccines for the most vulnerable people will expedite population-level immunity, which is central to resilient recovery from the devastating effects of Covid-19."

The additional financing for Nepal is one of three projects in a first phase of support for the Covid-19 vaccination effort across the South Asia region. Today, the World Bank’s Board also approved additional financing from IDA of $500 million for Bangladesh and $60 million for Afghanistan, complemented by $50 million from the Afghanistan Reconstruction Trust Fund (ARTF) and $3 million from the Energy Management Assistance Programme (ESMAP). In addition to financing, the World Bank is also providing technical assistance and knowledge-sharing workshops for countries in South Asia on different aspects of designing and deploying fair and equitable vaccine strategies.

The World Bank, one of the largest sources of funding and knowledge for developing countries, is taking broad, fast action to help developing countries respond to the health, social and economic impacts of Covid-19. This includes $12 billion to help low- and middle-income countries purchase and distribute Covid-19 vaccines, tests, and treatments, and strengthen vaccination systems. The financing builds on the broader World Bank Group Covid-19 response, which is helping more than 100 countries strengthen health systems, support the poorest households, and create supportive conditions to maintain livelihoods and jobs for those hit hardest.

IFC helps businesses in poorest countries fight Pandemic with $4 billion in Covid-19 financing

 IFC’s pandemic response is focused on reaching the most vulnerable people in developing countries.

Of the $8 billion in IFC Covid-19 fast-track financing approved by the IFC Board in March 2020, $4 billion has been committed to date, of which close to half is expected to benefit people in the poorest countries and fragile states, with the remainder helping to support the fight against Covid-19 across other developing countries and emerging markets.

“Supporting the private sector will be crucial to helping developing countries achieve an inclusive, sustainable and resilient recovery and stem the current rise in extreme poverty,” said World Bank Group president David Malpass. “Our goal with IFC’s fast-track Covid-19 facility is to provide needed liquidity for corporate and financial institution clients, which will provide working capital, support jobs and facilitate trade,” he added.

IFC’s Board in March approved $8 billion in financing to help companies affected by the outbreak. IFC –the largest global development institution focused on the private sector in emerging markets – has since fully deployed the $2 billion allocated under the trade-finance envelope of the fast-track facility. This support is helping client financial institutions keep liquidity flowing to businesses that depend on trade, especially micro, small and medium-sized enterprises (MSMEs), a major source of employment.

“IFC’s fast-track Covid-19 facility was designed to provide immediate liquidity to our financial institutions and real sector clients to preserve jobs and prevent short-term damage,” interim managing director, executive vice president and chief operating officer of IFC Stephanie von Friedeburg said. “By supporting private sector clients and interventions, we are hoping in the longer term to help reignite economic growth, paving the way for a better, more resilient and sustainable future once Covid-19 recedes.”

IFC has committed an additional $2 billion under the facility, benefiting every region in which IFC operates. This financing is being used for a range of purposes, from bolstering healthcare providers to helping the battered tourism sector and keeping viable businesses afloat, thus saving jobs. Another $623 million has been mobilised for these clients from private sector partners.

Additionally, the IDA Private Sector Window (PSW) – a tool developed by the World Bank Group to catalyze private-sector investment in the world’s poorest countries – has provided $281 million in guarantees supporting trade-finance and working-capital loans to small and medium-size enterprises (SMEs) in eligible countries since March.

IFC’s response is part of the World Bank Group’s effort to take broad, fast action to help developing countries strengthen their pandemic response, increase disease monitoring and improve public-health interventions, a press note issued by the IFC reads. “The World Bank Group has the financial capacity to deploy $160 billion over the next 15 months, including a potential $47 billion from IFC in overall support for the private sector.”

Looking ahead, IFC will work with its partners to help restructure and recapitalise viable businesses and set the stage for an inclusive, sustainable and resilient recovery. In August, IFC also launched the $4-billion Global Health Platform, which is helping developing countries expand access to medical supplies such as masks, ventilators, test-kits and, eventually, a Covid-19 vaccine.

World Bank $10.85 million additional grant to support learning and build resilient education sector

 Nepal and the World Bank today signed a financing agreement for an additional grant of $10.85 million to the School Sector Development Programme (SSDP) to maintain access to basic education and continued learning for children amid the Covid-19 crisis.

The government’s SSDP is a sector-wide program supported by IDA credit of $185 million, together with support from Asian Development Bank (ADB), European Union (EU), Finland, Global Partnership for Education (GPE), Japan International Cooperation Agency (JICA), Norway, USAID, UNICEF and REACH Multi-Donor Trust Fund administered by the World Bank. The programme aims at improving the quality, equitable access, and efficiency of basic and secondary education in Nepal.

The additional grant from the GPE Covid-19 Accelerated Funds will contribute to the implementation of the Ministry of Education, Science and Technology’s Covid-19 contingency plan to mitigate and respond to the potential impacts of the pandemic on the education sector.

The agreement was signed by the Joint Secretary at the Finance Ministry Shreekrishna Nepal on behalf of the government of Nepal and by the World Bank country director for Maldives, Nepal and Sri Lanka, Faris Hadad-Zervos.

“We are thankful to the World Bank and GPE for the additional grant that will help mitigate learning loss for children due to the impact of Covid-19,” Nepal said, adding that the grant provides much needed support to the government to respond to the impacts of the pandemic to enable continuity of learning during school closures, enable schools to safely resume and mitigate the impacts on students and teachers, including loss of learning time and psychosocial impacts.

The additional grant will finance activities to support remote learning programmes through television, radio and the learning portal as well as printed learning packs for children who do not have access to media or internet. The grant will support communication campaigns and teacher professional development programmes and help strengthen the Education Management Information Systems. The grant will also support provincial and local governments to support safe reopening of schools and continued learning of children.

“The education sector in Nepal and across the world has been one of the hardest hit owing to the pandemic which has deeply affected learning outcomes for children”,  World Bank country director for Maldives, Nepal and Sri Lanka Faris Hadad-Zervos, said after signing ceremony. “While supporting the immediate needs for safeguarding access and learning for children, especially girls, the additional grant will support the broader resilient recovery efforts of the government and help build back better the education sector in Nepal.”

IFC awards Nepal Investment Bank

Nepal Investment Bank Limited (NIBL) – one of the largest private sector bank in Nepal – bagged an ‘Award of Recognition’ from International Financial Corporation (IFC) – a member of the World Bank Group – for ‘2019 Best Partner in Low Income IDA Countries, South Asia’, for maximum volume of trade finance from Nepal under Global Trade Finance Programme (GTFP).
IFC partnered with Nepal Investment Bank to promote Trade Finance in Nepal to enable the bank to enhance its support for local enterprises and help boost international trade opportunities. IFC’s Trade Finance support enabled the country’s corporate and small and medium enterprise sector to increase their share of global trade and get recognised by a wider range of correspondent banks globally. The network facilitates transactions in challenging markets, promotes competitive financing, and builds correspondent bank relationships with new institutions at low risk.
International Development Association (IDA) – involved on ending extreme poverty and boosting shared prosperity – is critical for South Asia, world’s fastest growing region to deliver sustained and inclusive growth, human capital development and resilience.
Nepal Investment Bank has been catering to its customer from 82 branches, 124 ATMs, 17 extension counters, 10 revenue collection counters and 56 branchless banking counters, according to a press note issued by the bank. The bank, being the recipient of five Financial Times Bank of the Year awards for exemplary service and business, was accredited with Euromoney awards for ‘Best Bank 2018’ from the international publication – Euromoney. Further, International Credit Rating Agency- Nepal (ICRA Nepal) has also given the bank a credit rating of ‘A’.

ADB retains top spot in aid transparency index, MCC also transparent

The Asian Development Bank (ADB) retained its first place ranking in the 2020 Aid Transparency Index (ATI), an independent measurement of aid transparency released today at the Brookings Institution in Washington, DC.
In the index, spearheaded by British nongovernment organization Publish What You Fund, ADB’s sovereign portfolio is ranked in the ‘very good’ transparency category of the ATI with the top score of 98. “I take great pride in ADB’s first position in an index that is playing a key role in helping to promote greater transparency and openness among international agencies,” ADB president Masatsugu Asakawa said, adding that ADB has continuously worked to improve the disclosure of its aid data in terms of quality and scope. “Our top ranking reflects the dedication of staff, across the organisation, to ensure adherence to aid transparency standards.”
This is the second time that ADB ranked No 1 in the ATI, which had its pilot run in 2011. The 2020 Index is the seventh full Index report to monitor and encourage progress toward aid transparency. Data collection was carried out from December 2019 to April 2020, and focused on 35 indicators, grouped into five components: finance and budgets, joining up development data, organizational planning and commitments, project attributes and performance. The Index groups donors into five categories based on their overall scores (out of 100).
Ten other organisations among the 47 ranked were this year classified in the ‘very good’ category with a score of at least 80 per cent – the World Bank-International Development Association (WB-IDA), the United Nations Development Programme (UNDP), the African Development Bank–Sovereign portfolio, the Inter-American Development Bank, the United Nations Children's Fund (UNCF), the US Millennium Challenge Corporation (MCC), the Global Fund, UK Department for International Development, the Canada Global Affairs, and the Global Alliance for Vaccines and Immunisation.
The 2020 Aid Transparency Index reveals an improvement in overall transparency among the world’s major aid agencies. Development partners are publishing more, better quality data in the International Aid Transparency Initiative (IATI) Standard, according to the publishers. All of the development partners, except those in the ‘very poor’ category, are publishing IATI data about their activities and policies, meaning their information is open, timely, comparable and centralised, meeting the international standard for aid transparency.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 68 members, 49 from the region.

Unprecedented crisis could push up to 60 million into extreme poverty

Covid-19 (coronavirus) pandemic and shutdown of advanced economies could push as many as 60 million people into extreme poverty, according to the World Bank.
“The pandemic and shutdown of advanced economies could push as many as 60 million people into extreme poverty, erasing much of the recent progress made in poverty alleviation,” said World Bank Group President David Malpass. “The World Bank Group has moved quickly and decisively to establish emergency response operations in 100 countries, with mechanisms that allow other development partners to rapidly expand the programmes,” he said, adding that to return to growth, the multilateral agency’s goal must be rapid, flexible responses to tackle the health emergency, provide cash and other expandable support to protect the poor, maintain the private sector, and strengthen economic resilience and recovery.
In line with its rapid response, the World Bank Group today announced its emergency operations to fight Covid-19 (coronavirus) have reached 100 developing countries, home to 70 per cent of the world’s population. Since March, the Group has rapidly delivered record levels of support in order to help countries protect the poor and vulnerable, reinforce health systems, maintain the private sector, and bolster economic recovery, according to a press note issued by the Bank Group.
This assistance, the largest and fastest crisis response in the Bank Group’s history, marks a milestone in implementing the Bank Group’s pledge to make available $160 billion in grants and financial support over a 15-month period to help developing countries respond to the health, social and economic impacts of Covid-19 and the economic shutdown in advanced countries, the press note reads.
Of the 100 countries, some 39 are in Sub-Saharan Africa. Nearly one-third of the total projects are in fragile and conflict-affected situations, such as Afghanistan, Chad, Haiti, and Niger. The International Finance Corporation (IFC) and Multilateral Investment Guarantee Agency (MIGA) have also fast-tracked support to businesses in developing countries, including trade finance and working capital to maintain private sectors, jobs and livelihoods.
The Bank Group’s support through grants, loans and equity investments will be supplemented by the suspension of bilateral debt service, as endorsed by the Bank’s governors. IDA-eligible countries that request forbearance on their official bilateral debt payments will have more financial resources to respond to the Covid-19 pandemic and fund critical, lifesaving emergency responses.
“The bilateral debt-service suspension being offered will free up crucial resources for IDA countries to fund emergency responses to Covid-19,” Malpass said, adding that nations should move quickly to substantially increase the transparency of all their governments’ financial commitments. “This will increase the confidence in the investment climate and encourage more beneficial debt and investment in the future.”
The Bank Group’s operational response will strengthen health systems, support the poorest households, and create supportive conditions to maintain livelihoods and jobs for those hit hardest. Country operations will deliver help to the poorest families through cash transfers and job support; maintain food security, nutrition and continuity of essential services such as clean water and education; target the most vulnerable groups, including women and forcibly displaced communities, who are most likely to be hit hard; and engage communities to support vulnerable households and foster social cohesion. The scale and speed of the Bank Group’s response is critical in helping countries mitigate the adverse impacts of this crisis and prioritise the human capital investments that can accelerate recovery.
The Bank Group’s operations in 100 countries aim to save lives, protect livelihoods, build resilience, and boost recovery by:
•       Strengthening health systems, monitoring, and prevention, particularly in low-income countries and in fragile and conflict-affected situations. The Bank Group’s health response addresses emergency containment and mitigation needs for Covid-19, including strengthening countries’ health systems to treat severe cases and save lives. Establishing and supporting efforts in fragile and conflict-affected situations is a priority, given the rapidly growing number of cases in some of these countries.
•       Scaling up social protection: The Bank Group is leveraging countries’ existing social protection systems to help families and businesses restore income, preserve livelihoods, and compensate for increasing prices and unexpected medical expenses. These safety nets will need to be augmented with safe, direct food distribution, accompanied by key information on nutrition, social distancing, and hygiene.
•       Supporting businesses and preserving jobs: The International Finance Corporation (IFC) continues to implement its $8 billion fast-track financing facility, which aims to keep companies in business and preserve jobs. Close to 300 clients have requested support, and the facility may be oversubscribed. Building on this effort and market demand, IFC aims to provide $47 billion in financing to developing countries over 15 months. Cumulative Covid-19 related commitments under IFC’s Global Trade Finance Program, which supports small and medium-sized enterprises involved in global supply chains, have totaled 1,200 transactions across 33 countries for $1.4 billion, with 51 per cent of this volume in low-income and fragile countries.
•       Procuring medical equipment and supplies: Many developing countries import most, and in some cases all, of the medical supplies critical for fighting Covid-19, leaving them extremely vulnerable to supply disruptions and export restrictions.

Government and World Bank sign financing agreement for Coronavirus response

The World Bank has approved a fast-track $29 million COVID-19 Emergency Response and Health Systems Preparedness Project to help Nepal prevent, detect, and respond to the COVID-19 pandemic and strengthen its public health preparedness.
The agreement has been signed today by the Finance Ministry and the World Bank, according to a press note issued by the World Bank.
The project will focus on the immediate response and preparedness needs to fight the virus. The project provides emergency support to enhance Nepal’s capacity to detect cases and ensure prompt contact tracing consistent with World Health Organisation (WHO) guidelines and Ministry of Health and Population protocols. “It will also help set up new intensive care units, beds, and isolation facilities across the country, the press note reads, adding that the project will be implemented by Ministry of Health and Population.
“We are thankful to the World Bank for the response in a record short period of time, which will help Nepal respond to the COVID-19 pandemic and strengthen our capacities to deal with future public health risks,” finance secretary Sishir Kumar Dhungana said, adding that immediately after the outbreak of COVID-19 in the country, the government of Nepal has made several arrangements to prevent and address the possible crisis. “Due to these measures, the socio economic activities are going to be affected.”
“Further support is being anticipated from the World Bank to cope with the emerging pandemic situation,” he added, after the signing ceremony.
The project will also equip designated health facilities with personal protective equipment and hygienic materials and increase the diagnostic capacity of laboratories for responding to public health emergencies. It will enhance the National Public Health Laboratory to handle harmful infectious diseases and strengthen public institutions to coordinate and better manage response activities in all three levels of government.
“Given the unprecedented nature of the COVID-19 pandemic, the government’s rapid response will help save lives across Nepal,” World Bank country manager for Nepal Faris Hadad-Zervos said, adding that the World Bank and its development partners are committed to helping Nepal beef up its health infrastructure and access the resources it needs to fight the spread of COVID-19and protect the livelihoods of its people.
The project is financed from the International Development Association (IDA), the World Bank’s concessional credit window for developing countries, through the World Bank Group’s COVID-19 Fast-Track Facility. It will be effective immediately after the signing, the press note reads, adding that it has also an option of World Bank-facilitated procurement as and when required as per the request of the implementing agency.
The agreement was signed by finance secretary Sishir Kumar Dhungana on behalf of the government of Nepal and World Bank country manager for Nepal Faris Hadad-Zervoson behalf of the World Bank.
The World Bank Group is rolling out a $14 billion fast-track package to strengthen the COVID-19 response in developing countries and shorten the time to recovery. The immediate response includes financing, policy advice and technical assistance to help countries cope with the health and economic impacts of the pandemic. The IFC is providing $8 billion in financing to help private companies affected by the pandemic and preserve jobs. IBRD and IDA are making an initial $6 billion available for the health-response. As countries need broader support, the World Bank Group will deploy up to $160 billion over 15 months to protect the poor and vulnerable, support businesses, and bolster economic recovery.

WB approves additional credit to support reconstruction

The World Bank has approved an additional credit of $200 million to the Earthquake Housing Reconstruction Project (EHRP) in Nepal.
The project and the second additional financing contribute to the Nepal’s umbrella Housing Reconstruction Program (HRP), which aims to rebuild earthquake-resistant core housing units by providing housing grants to eligible beneficiaries who have enrolled in the programme. The second additional financing will scale up EHRP’s support to the government’s HRP by financing reconstruction of an additional 86,680 houses in the 32 districts affected by the 2015 earthquakes. The impact of the earthquakes is estimated at 35 per cent of Nepal’s Gross Domestic Product (GDP) with recovery needs of about $7 billion.
“It is our aim to ensure that no one is left behind as Nepal builds back better from the devastating earthquakes of 2015,” World Bank country director for Nepal, Sri Lanka and Maldives Idah Z Pswarayi-Riddihough is quoted in a press note issued by the World Bank office in Kathmandu. “We support the Government of Nepal’s efforts in reconstruction to help Nepalis rebuild not just homes but also lives,” he added.
The EHRP, approved in June 2015 supported resilient reconstruction of approximately 55,000 houses in the districts most affected by the earthquakes while an additional IDA credit of $300 million was approved in December 2017 to scale up the EHRP and help bridge the financing gap in the HRP by supporting 96,000 additional households under the project.
The EHRP adopts an owner-driven housing reconstruction approach that promotes earthquake-resistant building techniques and materials and aims at improving long-term resilience through a culture of safer and sustainable housing and settlements.
Under the project, eligible beneficiaries receive grants of Rs 300,000 (approximately $2,730) each for reconstruction of houses in compliance with approved reconstruction guidelines in three tranches. As of January 2020, out of 685,193 beneficiaries enrolled under the government’s HRP in 14 most affected districts, 99 per cent received the first tranche, 81 per cent received the second tranche, and 70 per cent received the third tranche of the housing grant.

World Bank projects 6.5 per cent economic growth

The World Bank projects continued strong growth with an average annual rate of 6.5 per cent – in the medium term – driven by investments in the tourism sector, particularly the Visit Nepal Year 2020 (VNY2020) programme, including efforts to increase air connectivity.
High tourist arrivals will be supported by the Visit Nepal Year 2020 programme, the completion of the second international airport, the construction of big hotels and the increase in air connectivity through implementation of the newly-revised air service agreements with countries like Australia, Cambodia, China, the UAE and Vietnam, the update noted.
The 6.5 per cent growth forecast by the multilateral development partner – in fiscal year 2019-20 – is sharply lower than the 8.5 per cent economic growth target of the government for the current fiscal year.
Launching Nepal Development Update today, the World Bank claimed that industrial growth is likely to be supported by construction activities, investments in the cement and hydropower sectors, and improved capacity utilisation in the manufacturing sector.
The report also notes that import growth will slow down as the government implements its programme to keep the fiscal deficit in check. “It should help contain the trade deficit,” the report reads adding that inflation is expected to pick up slightly but will remain below 5 per cent assuming stable agricultural production, regular supply of electricity, and low inflation in India. “The focus going forward will need to be on strengthening exports.”
“Increased exports will be critical to sustained growth over the medium-term,” said World Bank senior economist Dr Kene Ezemenari, who led the team that produced the update. “It will be important for government to continue with reforms to attract foreign investment,” she said, adding that future reforms will need to be grounded in strong analysis and data to effectively support Nepal’s growth aspirations.
On the supply side, according to the report, the growth will continue to be driven by private investment and government consumption. “Government consumption will be supported by increased spending on salaries and on goods and services,” the report reads, adding that efforts, in addition, aimed at building capacity at the sub-national levels coupled with the implementation of performance-based contracts is also likely to raise government spending.
The Nepal Development Update – a bi-annual report of the World Bank – highlights the importance of data for development, particularly in the context of the country’s historic transition to federalism. Federalism has created a surge in demand for more and better data. Enhanced data availability is needed to strengthen planning and budgeting at the sub national levels, including the preparation of Medium-Term Expenditure Frameworks (MTEF).
In addition, the transfer of fiscal resources to sub national levels also requires data on several parameters. A robust federal framework therefore rests on more and better data that will support evidence-based policies.
“The need for Nepal is data that is disaggregated, more frequent, reliable and accessible,” finance minister Dr Yuba Raj Khatiwada said. “Nepal’s federal structure has added another dimension for data at the provincial level, which is a challenge but very important for development programmes to leave no one behind,” he said, adding that the Statistics Act, which is to be approved soon, is expected to further empower the Central Bureau of Statistics (CBS) and provide added responsibility to sub national governments on data for national policy making.
In its Special Focus section, the report articulates a vision for a future data ecosystem and the need for short-term reforms to make the most of existing data and long-term reforms that establish an enabling environment that fosters data sharing, integration and use. Measures that can be implemented in the short-term include the publication of data in machine readable format, and the development of a comprehensive data dissemination policy and open government strategy.
“Data is central to the success of federalism,” World Bank Country Manager for Nepal Faris Hadad-Zervos said. “Nepal needs a vision and strategy for a future data ecosystem that is aligned to the new federal structure and promotes engagement of civil society and the private sector,” he said, adding that engaging all data actors – including civil society, the private sector and government agencies at various levels – can play a greater role in data production, sharing and use. “This will help in the design of reforms for better service delivery to citizens and an improved business and investment climate.”
In Nepal, the World Bank Group (WBG) includes the International Development Association (IDA), the concessionary lending arm; the International Finance Corporation (IFC), the private sector arm; and the Multilateral Investment Guarantee Agency (MIGA), the investment risk insurance arm.
The World Bank currently supports 25 active investment projects in Nepal with $2.4 billion dollars in commitments from IDA. The indicative resources available under IDA18 (fiscal year 2018-20) were about $1.39 billion, including $300 million from the IDA Risk Mitigation Regime. IFC aims to commit about $800 million to $1.2 billion over the five-year period (fiscal year 2019 to fiscal year 2023). MIGA is actively seeking opportunities to support foreign private investment into Nepal. IFC and MIGA may make use of the IDA IFC/MIGA Private Sector Window (PSW) and the MIGA Guarantee Facility to underwrite eligible projects.
The World Bank Group (WBG) fielded its first economic mission to Nepal in 1963 to assess the country’s development prospects and challenges. It approved its first credit in 1969 for a telecommunications project. Since then, the World Bank has provided Nepal $4.75 billion in assistance, some $3.48 billion in credits and $1.27 billion in grants.

IFC, partners provide more than $450 million for Upper Trishuli-1

International Finance Corporation (IFC) – a member of the World Bank Group – and a consortium of other lenders today finalised a $453 million debt financing package that will support the construction of a landmark hydroelectric plant in central Nepal.
The plant – Upper Trishuli-1 – will increase Nepal's electricity supply by one-third from today’s levels and provide clean, reliable power to some 9 million people, part of a larger effort by IFC to create markets and fight poverty in the country.
IFC is the lead arranger of the debt package, which includes eight other lenders, and is one of the largest foreign direct investments (FDI) in Nepal’s history. The financing is being provided to the privately-owned Nepal Water and Energy Development Company. The firm will develop and operate a 216-megawatt (MW), run-of-the-river hydroelectric plant on the Trishuli River about 70-km north of Kathmandu. Officially known as Upper Trishuli-1, the project’s financing structure, competitive tariffs, and use of internationally accepted contract standards is expected to set a standard for future hydropower projects in Nepal.
“This project is a game-changer for Nepal," said energy minister Barshaman Pun, during the signing ceremony of the financial closure. “Not only will it power hundreds of thousands of homes and businesses, but it will also serve as an example of how private companies can help Nepal expand its hydropower sector and attract much needed foreign direct investment,” he added.
Nepal's rivers – fed by runoff from the Himalaya Mountains – could support 43 gigawatts (GW) of electrical generation capacity. But less than three per cent of that has been developed as of today. As well, the country has suffered from blackouts and brownouts, hampering businesses and making life difficult for residents.
"There is no question that Nepal has the potential to be an energy powerhouse," said the chief executive officer of the Nepal Water and Energy Development Company Bo-Seuk Yi. “To realise that promise, Nepal can enlist the help of private companies, which have the capital and expertise to make major projects a reality,” he added.
The new hydroelectric plant is expected to be completed in 2024. Along with providing clean, reliable power to millions, it will set new environmental and social-impact benchmarks and enhance benefits for local communities. Furthermore, a cumulative impact assessment of existing and planned hydropower projects has been completed for the Trishuli basin, which will help guide sustainable development in the watershed.
“This project represents a significant milestone in the development of Nepal’s hydropower potential as it has been able to attract meaningful private sector participation, particularly from international investors,” said IFC director for South Asia Mengistu Alemayehu. “It also shows the unprecedented resilience and commitment by the government, the sponsors, and other stakeholders against all odds over the years,   including a major earthquake,” he said, adding that the development partners expect the project to become a model for expanded investments in developing Nepal’s hydropower to meet the growing domestic demand and export to the neighboring countries.
IFC and a consortium of Korean and Nepali partners, in collaboration with the Government of Nepal, have spent over seven years developing the Upper Trishuli-1 project, which is a prime example of IFC’s ability to create markets through upstream project preparation work over many years in low-income countries.
The Nepal Water and Energy Development Company’s key owners are Korea South-East Power, Daelim Industrial, Kyeryong Construction Industrial, and IFC. IFC is providing $190 million in financing, including $95 million of equity and loans from its own account, and $95 million as the implementing entity for other funding sources. The Multilateral Investment Guarantee Agency (MIGA) – yet another member of the World Bank Group – will provide $135 million in guarantees to cover political risk for the sponsors. Other financiers include the Export and Import Bank of Korea, the Asian Development Bank (ADB), the Asian Infrastructure and Investment Bank (AIIB), the Korea Development Bank (KDB), the United Kingdom’s development finance institution, Commonwealth Development Corporation (CDC), the Dutch Entrepreneurial Development Bank,Nederlandse Financierings-Maatschappij Voor Ontwikkelingslanden NV (FMO), the OPEC Fund for International Development, and Proparco.
Because of its unique development impact, pioneering features, and demonstration to private investors, the project also includes support from the International Development Association’s (IDA) Private Sector Window, a global facility of concessional funds to support high-impact private sector investments in lower-income countries, the Finland-IFC Blended Finance for Climate Program, and the Climate Investment Funds.
As part of the record $75 billion IDA18 replenishment, the World Bank Group created the $2.5 billion IDA Private Sector Window to catalyze private sector investment in the poorest and most fragile countries. Recognising the key role of the private sector in achieving IDA18 objectives and the Sustainable Development Goals (SDGs), the window provides concessional funds for co-investment alongside IFC and Multilateral Investment Guarantee Agency (MIGA) private investments. Concessional funds help to mitigate risk and reduce barriers, which unlocks and crowds in private investment in emerging markets.
Likewise, IFC – a sister organisation of the World Bank and member of the World Bank Group – is the largest global development institution focused on the private sector in emerging markets. “We work with more than 2,000 businesses worldwide, using our capital, expertise, and influence to create markets and opportunities where they are needed most,” the agency said, adding that it delivered more than $19 billion in long-term financing for developing countries – in the fiscal year 2019 – leveraging the power of the private sector to end extreme poverty and boost shared prosperity.

Government and World Bank take stock of project portfolio

The joint government and World Bank portfolio review concluded today covering 24 World Bank-financed projects with a total commitment of $ 2.35 billion. The concluding meeting was chaired by finance minister Dr Yuba Raj Khatiwada and World Bank country director for Nepal, Sri Lanka and the Maldives in the South Asia Region, Idah Z Pswarayi-Riddihough.
Of the 24 projects, some 20 are investment projects worth about $ 1.78 billion, three Programme for Results operations worth about $468 million and one Development Policy Credit worth about $100 million spread across energy, transport, earthquake housing reconstruction, education, health, social protection, water and irrigation, agriculture and livestock and public financial management sectors, according to a press note issued by the multilateral development partner.
“The government acknowledges the support of the World Bank and its assistance to Nepal’s development priorities,” finance minister Dr Khatiwada said, adding that the review is an opportunity to learn from and apply good practices across the different sectors while chalking out a roadmap for project delivery to ensure that development finance received for Nepal is utilized most productively.
Prior to the concluding meeting of the portfolio review, a three-day sectoral review was organised on September 9 to September 11 under the chair of the secretaries of the concerned line ministries. The annual stocktaking exercise is organised to review the performance of ongoing projects, assess the impact of federal transition and project restructuring, review procurement and disbursement performance and discuss implementation challenges.
“The World Bank celebrates 50 years of the first International Development Association (IDA) credit to Nepal this year and we are indeed proud to be a trusted partner in Nepal’s development agenda,” World Bank country director for Nepal, Sri Lanka and the Maldives in the South Asia Region Idah Z Pswarayi-Riddihough, said, adding that the World Bank is encouraged by the successful implementation of projects in Nepal and look forward to working with the government to address implementation bottlenecks for effective and timely completion of projects for the benefit of the people of Nepal.
Following the review, a memorandum of understanding (MoU) was signed between the Finance Ministry and the World Bank identifying an action plan by sector for improving the portfolio performance of projects, specific actions to improve implementation environment under the new federal structure and a tentative portfolio pipeline for fiscal year 2019-20 and fiscal year 2020-21. The portfolio review was attended by authorities from related ministries and departments, National Planning Commission (NPC), FCGO, Office of the Auditor General, Nepal Rastra Bank (NRB), World Bank (WB) and project teams.

David Malpass becomes 13th president of World Bank Group

The executive directors of the World Bank (WB) today unanimously selected David R Malpass as president of the World Bank Group for a five-year term beginning on Tuesday, April 9, 2019. The board expressed its deep gratitude to interim president Kristalina Georgieva for her dedication and leadership in recent months, reads a press note issued by the World Bank.
Malpass previously served as under secretary of the treasury for International Affairs for the United States (US). As under secretary Malpass represented the US in international settings, including the G-7 and G-20 deputy finance ministerial, World Bank-IMF Spring and Annual Meetings, and meetings of the Financial Stability Board, the Organisation for Economic Cooperation and Development (OECD), and the Overseas Private Investment Corporation (OPIC).
The executive directors followed the selection process agreed in 2011, the note reads, adding that the process included an open, transparent nomination where any national of the bank’s membership could be proposed by any executive director or governor through an executive director. "This was then followed by thorough due diligence and a comprehensive interview of Malpass by the executive directors."
The Board looks forward to working with Malpass on the implementation of the Forward Look and the capital package agreement as articulated in the Sustainable Financing for Sustainable Development Paper.
In his role as under secretary, Malpass played a crucial role in several major World Bank Group reforms and initiatives, including the recent capital increase for IBRD and IFC. He was also instrumental in advancing the Debt Transparency Initiative, adopted by the World Bank and IMF, to increase public disclosure of debt and thereby reduce the frequency and severity of debt crises.     
Prior to becoming under secretary, Malpass was an international economist and founder of a macroeconomics research firm based in New York City. Earlier in his career, Malpass served as the US deputy assistant secretary of the Treasury for Developing Nations and Deputy Assistant Secretary of State for Latin American Economic Affairs. In these roles, he focused on an array of economic, budget, and foreign policy issues, such as the US involvement in multilateral institutions, including the World Bank.
Malpass has served on the boards of the Council of the Americas, Economic Club of New York, and the National Committee on US–China Relations. Malpass earned his bachelor’s degree from Colorado College and his MBA from the University of Denver.  He undertook advanced graduate work in international economics at the School of Foreign Service at Georgetown University.
The World Bank president is chair of the boards of directors of the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA). The president is also ex officio chair of the boards of directors of the International Finance Corporation (IFC), the Multilateral Investment Guarantee Agency (MIGA), and the Administrative Council of the International Centre for Settlement of Investment Disputes (ICSID).

High-level World Bank Group delegation heads for Nepal Investment Summit

The chief executive officer of the Multilateral Investment Guarantee Agency (MIGA) and two World Bank Group vice presidents will join development banks, ambassadors, and hundreds of investors from more than 30 countries at the Nepal Investment Summit on March 29 and 30, according to the World Bank.
The summit aims at helping attract private financing for key infrastructure projects as Nepal undertakes new regulatory reforms.
The top three bank officials including executive vice president and CEO of MIGA Keiko Honda, vice president of the World Bank’s South Asia region Hartwig Schafer, and vice president at the Economics and Private Sector Development of International Finance Corporation (IFC) Hans Peter Lankes will take active part in the summit.
The three World Bank Group representatives will discuss the bank’s support for Nepal with Prime Minister K P Sharma Oli and finance minister Dr Yuba Raj Khatiwada, the bank's press note reads.
“Nepal has been a rising star in South Asia with foreign direct investment flows reaching a record high in 2017, and likely to remain an important investment destination in the region," Honda said, adding that it confirms Nepal’s efforts to improve its investment climate and become a competitive investment destination for multinational companies that want to have an impact. "We stand ready to work with investors and the government to make Nepal a hub for investment in infrastructure that improves lives, leads to sustainable growth and delivers opportunity for its citizens."
"With 25 projects approaching $3 billion in financing, we are here for the long haul and will continue to support infrastructure development, policy reforms, skills development, and anything required," South Asia VP Schafer said, adding that there is a clear acceptance by Nepal authorities that the country’s prosperity will rely on crowding in the investment from around the world. "Not only financial resources, but also technical and managerial know-how, will be critical to realise Nepal’s vast potential."
"IFC has played a role in creating markets and supporting investments for 60 years," added IFC VP Lankes. "In Nepal, we are looking to scale up significantly our investments in strategic sectors such as hydropower, agribusiness, tourism, and financial inclusion," he said, adding that the IFC is encouraged by the government’s efforts to improve the enabling environment and IFC plans to increase its cumulative investment portfolio to around $1 billion over the next four years.
Schafer will speak at the summit’s inaugural session tomorrow. Lankes and Honda will deliver special addresses at March 30 sessions on international experience-sharing and financing infrastructure, respectively.
In Nepal, the World Bank Group (WBG) includes the International Development Association (IDA), the concessionary lending arm; the International Finance Corporation (IFC), the private sector arm; and the Multilateral Investment Guarantee Agency (MIGA), the investment risk insurance arm.
The World Bank currently supports 25 active investment projects in Nepal with $2.6 billion in commitments from IDA and trust funds of which a significant portion is for policy reforms in the areas of fiscal decentralisation, the financial sector, and the energy sector. The indicative resources available under IDA18 (fiscal year 2018-20) are about $1.39 billion, including $300 million from the IDA Risk Mitigation Regime. IFC aims to commit about $800 million to $1.2 billion over the five-year period (Fiscal year 2019-23). MIGA is actively seeking opportunities to support foreign private investment into Nepal.
IFC Nepal focuses on private sector development through provision of financing and advisory services to companies to boost their competitiveness, while expanding financial inclusion and delivering sustainable infrastructure solutions. IFC’s current portfolio in Nepal is $57 million. The budget for advisory support aimed at creating bankable projects and building capacity stands at nearly $16 million.
The World Bank Group (WBG) fielded its first economic mission to Nepal in 1963 to assess the country’s development prospects and challenges. It approved its first credit in 1969 for a telecommunications project. Since then, the World Bank has provided Nepal $4.75 billion in assistance ($3.48 billion in credits and $1.27 billion in grants).

World Bank to provide $266mn concessional loan to Nepal

The International Development Association (IDA) of the World Bank (WB) is providing a concessional loan of $200 million under the first Programmatic Fiscal and Public Financial Management Development Policy Credit (DPC) in budgetary support and $66 million for Rani Jamara Kulariya Irrigation Scheme.
Country Director of the World Bank Qimiao Fan and finance secretary Rajan Khanal signed the agreement for the loan at a programme organised at Finance Ministry today.
The total amount worth $266 million is equivalent to approximately Rs 27.65 billion.
The loan proceeds available under ‘Development Policy Credit’ will be utilised in the sector of government’s priority through national budgetary system. This policy credit is tailored with prior actions of reform in fiscal and public financial management sector. The agreement remains effective until February 28, 2019.
The second agreement signed today is for Rani Jamara Kulariya Irrigation Scheme II which envisions modernising irrigation system and strengthening the water user’s associations committees and agricultural production support, according to the Finance Ministry press note.
In the second phase of modernisation of the project, the credit will be utilised to complete the remaining works of ongoing project. This credit agreement remains effective until December 31, 2023.
The World Bank has been extending DPC following Nepal’s reform initiative for the macro-economic and financial sectors.