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Conflict Affected Families in Armenia to Receive World Bank Support

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A Grant Agreement for the “Support to Conflict Affected Families” project was signed today by Sylvie Bossoutrot, World Bank Country Manager for Armenia, and Atom Janjughazyan, Acting Minister of Finance of Armenia. Funds for the project are provided by the multi-donor State and Peacebuilding Fund (SPF), through a one-year grant of $3.72 million.

The Government of Armenia has developed a broader social protection response package with support from development partners and non-governmental organizations. This project will be implemented by the Ministry of Labor and Social Affairs of Armenia, through its subordinated agency — the Unified Social Service — and aims to improve the resilience of conflict affected people and reduce the financial burden of host families, with a particular focus on women and vulnerable members of the population.

“We are pleased to sign this timely Agreement supported by the State and Peacebuilding Fund Grant,” said Sylvie Bossoutrot, World Bank Country Manager for Armenia. “This project is of extreme importance and the assistance granted to displaced individuals and their host families will help to improve the resilience of families affected by the conflict.”

The proposed project will contribute to selected social protection and employment support programs, which are part of a larger support package targeting displaced people and their host families, from the Government of Armenia.

Specifically, the project aims to:

  • Reach around 11,530 displaced persons with a monthly cash benefit equal to the minimum wage (68,000 AMD) per adult/child for up to four months in Armenia.
  • Provide cash assistance/income support to 3,975 families in Armenia hosting displaced people to help meet basic consumption needs.
  • Temporarily subsidize an employment program for 936 displaced people who are looking to gain work experience in Armenia and facilitate their labor market participation and economic inclusion.
  • Support 115 displaced individuals through the public works program (cash-for-work).

“The project is designed to especially benefit women affected by the conflict,” said Maddalena Honorati, World Bank Task Team Leader. “According to a rapid multi-sector needs assessment conducted last December, women represent 70 percent of the adult displaced population. The cash transfers will help them meet their basic needs on a day-to-day basis. More importantly, the project will improve the resilience of the displaced families and promote social cohesion in their host communities.”

The State and Peacebuilding Fund is a global fund administered by the World Bank to finance critical development operations and analysis in situations of fragility, conflict, and violence (FCV). The SPF is kindly supported by Australia, Denmark, France, Germany, The Netherlands, Norway, Sweden, Switzerland, The United Kingdom, as well as the World Bank.

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Financing to Support Reforms for Inclusive Growth and Development

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The World Bank approved the second in a series of three single-tranche Inclusive Growth Development Policy Operations (IGDPO) to support key reforms for enabling inclusive growth in Liberia.  The financing, amounting to $40 million, comes in the form of an International Development Association (IDA) concessional credit of $20 million and an IDA grant of $20 million to be disbursed as budget support. The underlying reforms being supported seek to remove distortions in selected sectors, strengthen public sector transparency, and promote economic and social inclusion.

“The continued implementation of critical policy reforms in sectors such as energy and agriculture helps create a conducive environment for transformative investments being made in these sectors by the Government, with support from development partners,” said Dr. Khwima Nthara, World Bank Liberia Country Manager.  

Building on reforms supported under the first reform program approved last year, the key reforms under this second program are expected to help increase agriculture productivity by promoting farmers’ access to certified seeds; reduce power theft and commercial losses at the Liberia Electricity Corporation (LEC) by making electricity affordable for the small consumers with the reduction in electricity tariffs for poor households from $0.385/kWh to $0.22/kWh in May 2021; streamline and increase the transparency of tax waivers and in turn, improve revenues to enhance the provision of public services, especially for poor households; strengthen the oversight and transparency of State-owned Enterprises (SOEs); promote financial inclusion through the amendment of the Payments Act and introduction of digital credit; and finally, create an efficient, transparent and sustainable Social Safety Net System.  

“Strengthening Domestic Revenue Mobilization, through reduction of duty waivers and tax holidays, is critical to expanding fiscal space for increased public investment that is domestically financed,” said Mamadou Ndione, World Bank Senior Economist and Task Team Leader of the IGDPO program.

The reform programs being supported are aligned with the Liberia’s Pro-poor Agenda for Prosperity and Development and the World Bank’s Country Partnership Framework.

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Latin America and the Caribbean: missing the chance to invest in a sustainable recovery?

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A new platform showcasing real-time data from 33 countries in Latin America and the Caribbean has revealed that on environmentally sustainable post-COVID-19 spending, Latin America and the Caribbean lags behind the rest of the world: 0.5 per cent of total spending and 2.2 per cent of long-term recovery spending was environmentally friendly in 2020 compared to 2.8 per cent and 19.2 per cent globally.

The tool, which is based on the Global Recovery Observatory, an initiative led by the Oxford University Economic Recovery Project (OUERP), and supported by UNEP, the International Monetary Fund and GIZ through the Green Fiscal Policy Network (GFPN), reveals that only six of the region’s 33 countries dedicated more than 0.1 per cent of their GDP to recovery spending. A small number did allocate a significant proportion of their budgets to post-COVID-19 efforts, including Chile (14.9 per cent), Saint Kitts and Nevis (13.3 per cent), Saint Lucia (11.3 per cent), Bolivia (10.5 per cent) and Brazil (9.26 per cent).

The examination of over 1,100 policies shows that approximately 77 per cent of the region’s total spending of USD 318 billion was allocated to rescue measures addressing short-term threats and saving lives, while only 16.1 per cent has focused so far on long-term recovery plans to revitalize the economy, given the limited financial resources of many of the region’s countries. On average, Latin America and the Caribbean has allocated USD 490 per capita expenditure to post-COVID-19 recovery, compared to USD 650 in Emerging Markets and Developing Economies, and USD12,700 in advanced economies.

The region has been severely affected by COVID-19. Home to 8 per cent of the world’s population, Latin America and the Caribbean has reported some 29 per cent of deaths from the pandemic, while it is estimated that in 2020, the region had a GDP contraction of 7 per cent.

“I applaud the initiative of Latin American and Caribbean ministers to track their progress towards greener recoveries. Our Tracker shows that overall, the region’s green spending does not yet match the severity of the triple planetary crises of climate change, biodiversity loss and pollution,” said Piedad Martin, Acting Director of UNEP’s Regional Office for Latin America and the Caribbean. “In order to transition to more sustainable and inclusive economies, nations in the region must build from this good start of tracking to further align their development priorities with green recovery.”

To date, according to the Tracker, a higher proportion of the region’s recovery budget has been spent on unsustainable sectors (USD 7.4 billion) than on environmentally-sustainable initiatives (USD 1.5 billion). 74 per cent of environmentally-negative spending has been directed to fossil energy infrastructure, and 13 per cent to unsustainable port and airport infrastructure, which is expected to lead to an increase in carbon emissions.

“The situation of the region is dire, the response to the pandemic is leading us to an increase in debt, limiting our capacity to direct investments to environmental sustainability. Yet, placing climate action as the engine of recovery has never been as important. Our survival and the competitiveness of the region is at stake due to climate change,” said Costa Rica’s Minister of the Environment and Energy Andrea Meza, who will chair the XXIII meeting of the regional Forum of Ministers of the Environment in 2022. “I call on governments, the international community and the private sector to support Latin America and the Caribbean in responding to this crisis through investments that allow us to meet the Paris Agreement.”

High-impact chances for the region are numerous and require a mix of policy measures. Key opportunities await in sustainable energy, in particular non-conventional renewable energy and energy efficiency; investments in zero-emission transport –with a special focus on public transport—; investments in nature-based solutions to ensure adaptation in key sectors, such as agriculture, and urban centres, where most of the population lives.

“The region has reached an economic crossroads. Either governments continue to support the old, dying industries of the past or invest in sustainable industries which will drive future prosperity. The new economic opportunities for the region are monumental and wise leaders will embrace them,” said Brian O’Callaghan, lead researcher at the Oxford University Economic Recovery Project.

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Cities in Southern Uzbekistan to Improve Urban Infrastructure and Municipal Services

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Residents of cities located in two southern regions of Uzbekistan will benefit from improved urban infrastructure and municipal services, thanks to Additional Financing for the Medium-Size Cities Integrated Urban Development Project (MSCIUDP), approved today by the World Bank’s Board of Executive Directors. The project will be supported by a $100 million concessional credit. The International Development Association, the part of the World Bank Group, will provide it to the Government of Uzbekistan at a very low-interest rate and with a repayment period of 30 years.

This additional financing will expand the geographic scope of the ongoing project funded by the World Bank that has been implemented in Tashkent (Yangiyul and Pskent), Bukhara (Kagan) and Namangan (Chartak) regions since 2019.   

The new project activities will cover selected mid-sized cities in Kashkadarya and Surkhandarya regions of Uzbekistan. The final list of all project cities in this part of the country will be validated over the next 6 months, in consultation with the regional and municipal governments (hokimiyats), based on local needs and economic potential.

Medium-size cities participating in the project in Surkhandarya and Kashkadarya regions will benefit from an integrated and specifically designed program of investments that will include the following: improved and expanded water supply and sanitation networks; upgraded electricity infrastructure and street lights, as well as vehicular, pedestrian and multimodal accesses to public transportation; upgraded energy-efficient public buildings; reconstructed public spaces and parks, street networks and associated infrastructure; and restored objects of cultural heritage.

The majority of the cities covered by the project have untapped growth potential. Many are located along strategic transport corridors; some have prominent tourist attractions; and most are well-positioned to create a range of quality service jobs for the surrounding rural areas.

All investments under the project will follow the most contemporary green design principles and aim to achieve universal accessibility. About 4 million people, equivalent to about 70 percent of the combined population of both regions, are expected to, directly and indirectly, benefit from the improved urban infrastructures, municipal services, and job opportunities created thanks to the project. 

“Many countries have effectively used urbanization as a development engine, like in the case of China, South Korea and Thailand. To achieve this, Uzbekistan needs to catch up with the backlog of urban infrastructure and services and upgrade public spaces to make cities more attractive and productive,” said Marco Mantovanelli, World Bank Country Manager for Uzbekistan. “Medium-size cities are growing fast here and have the potential for generating entry-level service jobs for youth. The combination of investments in infrastructure and capacity building of regional and municipal ‘hokimiyats’ to effectively manage and maintain urban assets will transform cities into comfortable places to live, work and do business. We are glad to support the Government in achieving this important goal.”

To complement the investments, the project will also offer additional support to regional and municipal hokimiyats through providing equipment and training to improve management and maintenance of urban infrastructure and assets, as well as modern environmental practices and green approaches to urban management.

Additionally, the project will help the Government to continue implementing reforms critical for sustainable urban development, including administrative and budgetary reform that should transfer more powers and resources to hokimiyats, and urban planning reform that should help ensure cities grow in an orderly and sustainable manner. 

The Ministry of Investment and Foreign Trade of Uzbekistan will continue implementing project activities in all five regions in close coordination with hokimiyats of the participating medium-size cities and regions, as well as key line ministries and state agencies. 

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