Spain Champions Support for Enhanced IMF-WBG Framework: Raising SDR Impact

IMF News, May 31, 2024

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Spain will channel "SDR 1.5 billion" to the IMF’s Resilience and Sustainability Trust (RST) after completing all national procedures.
Spain previously "raised its pledge to channel up to 50 percent of its 2021 SDR allocation" during the Annual meetings in Marrakech.
The contribution is intended "in support of climate policies identified by the national authorities with joint support by the World Bank and the IMF as the framework is operationalized."

The country-led framework will "optimize the resources the two institutions are dedicating to helping countries tackle climate challenges, including the IMF’s RST as well as the WBG’s policy and project financing, and additional resources from development partners and the private sector."
The enhanced framework will "accelerate country-led climate action—raising the effectiveness of SDRs channeled to the RST and the World Bank’s policy and project financing."
It is "also expected to help mobilize further financing—including from bilateral donors, multilateral development banks, and the private sector."

The World Bank Group "aims to provide 45 percent of its annual financing to climate by 2025."
WBG measures mentioned include "hybrid capital, portfolio guarantees, adjustments to its equity-to-loan ratio, and a new financial incentive framework for global challenges, while raising funds for a robust IDA21 replenishment."
The framework will combine IMF RST policy support, WBG policy and project financing, and "additional resources from development partners and the private sector."

"Generous pledges to the RST from 23 countries—including emerging market countries—are already supporting countries’ climate action."
Since it became operational "in October 2022, 18 countries have already benefitted from the RST and more than 30 countries are expected to make requests in the near future."
The IMF’s RST is described as "a key vehicle for providing policy support for climate action in emerging and developing economies and more contributions are needed to meet the strong demand from countries."

Minister of Economy, Trade and Business Carlos Cuerpo: Spain "continues to champion the need for further progress in channeling SDRs" and "encourages others to join in supporting the new framework and making additional pledges to the RST alongside supporting the WBG’s financial capacity, including through its new financial instruments, as well as the IDA21 replenishment."
World Bank Group President Ajay Banga: "Spain's commitment to multilateralism, alongside the strong collaboration between the World Bank and IMF, is a powerful example of how we can collectively accelerate climate action in developing countries. By working together, we can unlock critical resources and expertise to help build a more resilient and sustainable future."
IMF Managing Director Kristalina Georgieva: "I welcome Spain’s leadership on SDR channeling and support for the enhanced framework for IMF-World Bank Group collaboration."

"The IMF and the WBG appreciate the support of member countries and are working to quickly operationalize the joint enhanced framework for climate action."
Spain’s announced channeling of "SDR 1.5 billion" will be implemented "after completing all national procedures" and as the enhanced cooperation framework is operationalized.

Press Release No. 24/196, May 31, 2024 — IMF Communications Department.