Last week was a good week for the world's poor countries. It was also a good week for multilateralism and for Bob Zoellick, the World Bank's president. The rich country governments that support the International Development Association or IDA, the World Bank's concessional window, pledged a record $41.6 billion for IDA's 15th replenishment, a 30% increase over the 14th replenishment. Even more startling, the UK upped its contribution by a whopping 49% to overtake the US as IDA's largest contributor.
I draw four conclusions from the highly successful outcome for these negotiations. First, at least when it comes to money, the rich world does seem to understand the challenges facing those left behind. And not just the rich world, but also some not-so-rich. While the World Bank hasn't officially released the information, Bloomberg is reporting an increased contribution from Russia and, for the first time, a contribution from China.
Second, the success of these negotiations suggests that multilateralism is alive and well. This is good and important news. Over the past decade, Washington's increasingly unilateral approach to the world's problems made me wonder if we were in for another cold-war-like period of "us versus them" but this time the "us" would be the US and the "them" everyone else. The global challenges we face today will only yield to global solutions, and a healthy IDA is an essential part of the equation.
Third, Bob Zoellick is a very effective World Bank president. He may claim that IDA's success was "an endorsement of the bank's support for poor countries," but it is also an endorsement of him and his management style. If one thinks back to the turmoil that engulfed the Bank just six months ago, a record-breaking IDA really is a remarkable vote of confidence.
Fourth, with the ascension of the UK to #1 on the IDA donor list, the old international development order will never be the same. Whether or not it was ever true, no one can now say that IDA is merely an extension of the US Treasury. The UK can, if it chooses, reshape IDA's governance to make it a truly multinational development cooperative. Here's hoping that London takes advantage of this leadership opportunity.
These are all good and important things. But let's not forget that the money is the easy part. As hard as these negotiations may have been, spending IDA 15 well is going to be a lot harder. In "The World Bank's Work in the Poorest Countries: Five Recommendations for a New IDA," we list five recommendations for IDA deputies: (1) Admit you need it; (2) Beware the Christmas tree; (3)Stop playing politics; (4) Get serious about fragile states; (5) Sharpen incentives for performance. For details on what we mean by these, go to the report, but for now, we can comfortably say there has been real progress on the first and the third of these recommendations. The real work starts now. Delivering on the other three will need all of Mr. Zoellick's considerable skills.