WASHINGTON — Twenty-seven countries have taken steps to secure access to crisis financing from existing World Bank programmes since the start of the Iran war, according to an internal World Bank document reviewed by Reuters.
The countries are among 101 with access to pre-arranged financing options, including the World Bank’s Rapid Response Option, which allows eligible governments to redirect undisbursed project funds in response to shocks. Reuters reported that three countries have already finalised new financial instruments, while others remain in process. Source: Reuters.
The document did not identify all 27 countries or provide the total amount of potential financing being sought. However, it said the Iran war has disrupted global energy and fertilizer supply chains, increasing pressure on vulnerable economies. Kenya has been affected by high fuel prices, while Iraq has faced reduced oil revenue. Source: Reuters.
World Bank President Ajay Banga has said the bank could mobilise up to $60 billion within six months through existing mechanisms, and potentially up to $100 billion with longer-term changes. Reuters reported that some borrowers may find World Bank instruments more attractive than IMF programmes because IMF support is often tied to stricter fiscal conditions. Source: Reuters.
For African economies reliant on imported fuel, fertilizer and food inputs, the pressure could widen fiscal deficits, raise inflation and complicate debt-management plans. The growing demand for crisis financing shows how external commodity shocks can quickly become domestic budget, balance-of-payments and social-stability risks.
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