Created on September 24th 1960, the the International Development Association (AID) belonged to the Group of the the World Bank, based with Washington DC, which has like objective to help the Economic development the poorest countries. It is thus complementary to other body of loan of the Group of the World Bank which is the international Banque for the rebuilding and the development (BIRD), which exemption of the loans of investment and the consulting services to the countries with intermediate income. AID (often named IDA because of its English abbreviation) grants appropriations not carrying interest and of the gifts to poorest of the developing countries to support the rise of their economy and to improve the standard of living of their inhabitants.

Long-term credits without interest

The International development association grants long-term loans (expiries of 20,35 or 40 years, supplied with a grace period 10 years, before having to start to refund the main thing) to the 81 poorest countries of the planet, of which 40 are located in Africa.

Since its creation, the AID lent 161 billion dollars to 108 countries. The annual figures of the appropriations knew a constant growth and reached an average of 8,4 billion dollars during the three last years. Thus the poorest countries are given financial resources to try to start again to them economy, without that not involving notorious negative effects.

Three criteria are used to determine the eligibility of a country to the appropriations of the AID:

• relative Poverty, definite as a situation where GNP per capita is lower than a determined threshold, which is currently of 1.025 dollars (starting from July 1st, 2006)
• the absence of solvency making it possible to borrow under the terms of the market and consequently the need for finding resources in the concessional terms.
• Of good principles of economic management, given as being the implementation of the economic measures and social in favor of the growth and the reduction of poverty.

Which finality?

The long-term credits and without interest of the AID are used to finance programs which will make it possible to build the policies, the institutions, the infrastructures and the human capital that requires an at the same time equitable and bearable development on the environmental level.

The AID targeted development projects human in fields such as education, health, the safety devices social, the drinkable water provision and the cleansing (36%), the law, justice and the public administration (23%), the infrastructures (14%), agriculture and rural development (8%).

The objective of the AID is to reduce the inequalities as well between the countries as within those, by entitling the greatest number of people possible to take part in the large economic currents, by reducing poverty and by supporting a more equitable access to the possibilities generated by the economic growth.

Structure and operation

The Statutes of the AID came into effect in 1960. The first loans of the AID, called appropriations, were approved in 1961 in favor of Chile, of Honduras, of India and Sudan.

BIRD and the AID are managed according to the same rules. They share the same personnel and the same seat, they concern the same president and evaluate the projects in accordance with the same standards of rigor.

But the AID and BIRD draw their funds from sources different for the financing from their loans and, insofar as the appropriations of the AID are entirely concessional, its resources must be regularly reconstituted.

So that a country can adhere to the AID, it must be initially member of BIRD. The AID counts 165 members.

Financing of the AID

While BIRD mobilizes the essence of its resources on the international markets of the capital, the AID is dependant on the contributions of richest of its Member States essentially of its financial resources. The donor countries meet every three years to reconstitute the resources of the AID and to review its policies. The last reconstitution in date was the fourteenth of series (IDA-14). Concluded in February 2005, it makes it possible the AID to finance its projects for one three years period which will end on June 30th, 2008. The most important contributions to the IDA-14 were poured by: the the United States, the the United Kingdom, the Japan, the Germany, the France, the Italy and the Canada (countries forming old the G7).

The other major part comes from refundings of its appropriations, including those carried out by the countries which had profited from its assistance in the past but for summer “reclassified” (term which means that they do not need more to call upon the resources of the AID). It is the case of the Turkey and the South Korea, of the ex-borrowers of the AID, become today of the backers. Additional funds come from the incomes of BIRD.

See too

• BIRD
• Funds international currency
• Debt of the third world
• World Trade organization

External bonds

• Official site of the International Development Association
• Official site of the World Bank