The World Bank is preparing to mobilise between US$80 billion and US$100 billion (S$102 billion to S$127 billion) in funding over the next 15 months to support countries affected by the ongoing war in the Middle East, according to its president Ajay Banga.
The proposed package would exceed the US$70 billion deployed during the Covid-19 pandemic, underscoring the scale of economic disruption expected from the conflict, particularly for developing nations.
Speaking on April 15 on the sidelines of the International Monetary Fund (IMF) and World Bank spring meetings, Mr Banga said the funding plan would include an initial US$20 billion to US$25 billion in the coming months through a crisis response mechanism. This would allow countries to access up to 10 per cent of previously approved funds earlier than scheduled.
A further US$30 billion to US$40 billion could be made available within six months through the restructuring and repurposing of existing programmes, he added.
Mr Banga said that if the conflict persists or worsens, additional resources could be drawn from the bank’s balance sheet capacity to reach the upper end of the funding range, on top of its regular lending activities.
He described the initiative as part of a “tiered response” strategy designed to ensure sufficient financial support depending on how the crisis evolves, while maintaining flexibility to respond to escalating global needs.
The World Bank chief also warned that the conflict is already having a significant impact on global inflation and growth, with developing economies expected to be hit the hardest.
The IMF recently downgraded its global growth forecast, citing surging energy prices linked to the war, and warned that inflationary pressures could persist if the conflict continues.
IMF Managing Director Kristalina Georgieva said global growth could recover quickly if the war ends soon, but cautioned that prolonged instability would worsen economic conditions worldwide. She also urged governments to avoid broad energy subsidies, instead favouring targeted and temporary relief measures to manage rising costs.
