IDA Grants for HIV and AIDS Projects

• Pages: 203-204

Contenidos

• The Issue.
• Legal and Policy Considerations.
• Practice Examples.
• References.

Page 203

The Issue

Most international financing for HIV/AIDS projects is now on grant terms. Under the Thirteenth Replenishment of the resources of IDA (IDA 13), HIV/ AIDS projects benefited from an exception to regular IDA terms and received 100 percent grant financing in IDA-only countries and up to 25 percent grant financing in blend countries. ¹ Under the terms of the Fourteenth Replenishment (IDA 14) for the period FY06-08, this special rule for HIV/AIDS projects no longer applies. Based on the application of criteria relating to debt vulnerability, IDA-only countries may now qualify for grant financing for 100 or 50 percent of their total allocation. Some IDA-only countries only receive standard IDA credit terms.

Legal and Policy Considerations

Under the IDA 14 arrangements, grant financing is:

* Limited to IDA-only countries; and

* Based on a country-by-country analysis of the risk of debt distress.

The following provisions apply:

* Countries that are reclassified from blend country to IDA-only country prior to the IDA 14 mid-term review will continue to be ineligible for grants over the entire course of IDA 14.

* As an exception to the debt distress-based rule for grant eligibility, both Kosovo and Timor Leste benefit from grant terms. However, Timor Leste will be gradually phased out of grant eligibility over the IDA 14 period.

* IDA may finance on a grant basis the portion of the cost of regional projects attributable to IDA-only countries eligible for 100 percent grants under the debt-distress criterion.

In application of these provisions, HIV/AIDS projects may thus continue to benefit from grant terms in certain countries.

Page 204

For FY07 (July 1, 2006 to June 30, 2007) a 100 percent IDA grant allocation applies to: Afghanistan, Bhutan, Burundi, Cambodia, Central African Republic, Chad, Comoros, Congo (Democratic Republic of), Congo (Republic of ), Cote d'Ivoire, Djibouti, Eritrea, The Gambia, Guinea, Guinea-Bissau, Haiti, Kosovo, Kyrgyz Republic, Lao PDR, Liberia, Myanmar, Nepal, Niger, Rwanda, Sao Tome and Principe, Sierra Leone, Solomon Islands, Somalia, Sudan, Togo, and Tonga. For FY07 a 50 percent IDA grant allocation applies to: Angola, Ethiopia, Guyana, Lesotho, Malawi, Mongolia, Nicaragua, Samoa, Sri Lanka, Tajikistan. Timor Leste is eligible for a 60 percent IDA grant allocation, phasing down to 30% in FY08.

...