ENP Newswire - 16 July 2014
Release date- 15072014 - IDB President and Bill Gates Join Forces to Fight Poverty.
The President of the Islamic Development Bank, Dr. Ahmad Mohamed Ali, and Mr. Bill Gates, Co-Chair of the Bill and Melinda Gates Foundation, announced at the 39th Annual Meeting of the IDB Board of Governors, which was held on 25-26 June 2014 in Jeddah, the proposed establishment of a US$500 million grant Buy-Down Facility under IDB.
The Facility will enable the IDB to deploy up to US$2.5 billion of financing to fight poverty in low-income countries. The Facility builds on the success of a similar financing mechanism, by which IDB provided US$227 million to Pakistan to support the Polio Eradication Initiative.
To kick-start the new Buy-Down Facility, the Gates Foundation announced that it would contribute 20 percent (US$100 million) of the US $500 million. Grant resources from the Facility will be deployed along side IDB's own financing to completely offset the cost of financing that countries would otherwise incur. This 'buy-down' process will provide premium-free market resources to low-income countries. The two development leaders called on government aid-agencies, philanthropists and other
partners to contribute to the Facility, so that they all could together address poverty-focused interventions in health (polio, malaria and other neglected tropical diseases), agriculture (supporting small holder farmers) and infrastructure for the poor (energy and sanitation).
Commenting on this groundbreaking initiative, Dr. Ali said:'we are very pleased with the growing partnership between the IDB and the Bill and Melinda Gates Foundation. The Buy-Down Facility is indeed a highly innovative financing mechanism, which opens up new opportunities for increasing development assistance. This smart blending of donor funding with market resources could be a real game-changer in global development finance and is the perfect illustration of the triple-win (recipient
Speaking to the IDB Board of Governors and attendees, Mr. Gates said: 'Building on the success of the loan to Pakistan, we are working to build a much bigger pool of capital.... This facility will bring a huge amount of new, Sharia-compliant financing with no mark-up to the people who need it most. It is a historic innovation in development finance. I am deeply honored to participate in it, and invite others to do the same.'
The IDB Board of Governors welcomed the initiative and pledged its full support to its realization, noting that the initiative represents a paradigm shift from traditional funding mechanisms to a more sustainable way of providing development finance to least developed countries that can borrow only highly concessional resources, which are not available in sufficient amounts. The IDB Board of Governors appreciated Mr. Gates for his commitment to improving the lives of children and others and for
the Foundation's partnership with the IDB. Mr. Gates was among several dignitaries who attended the IDB 40th Anniversary celebrations and addressed the IDB Board of Governors during its annual meeting.
Bill & Melinda Gates Foundation: The Bill & Melinda Gates Foundation (the 'Gates Foundation') is a private philanthropic organization, founded in 2000 on the principle that all lives have equal value. The foundation is committed to removing the principal barriers that prevent the world's poorest people from leading health and productive lives. It does this by accelerating the development and delivery of life-saving advances in health, agricultural development and nutrition. For more information,
please visit http://www.gatesfoundation.org