MANARAT INTERNATIONAL UNIVERSITY

Course title :-International Economics & Finance

Course code :- FIN 413
Program :- Department of Business
Administration
Course Teacher:- RASEL AHMED CHOWDURY
Name of Group Members & I.D

 MIMO BARUA -1232BBA02121

 MD. MONIR HOSSAIN-1232BBA02142
 MD. MOBAROK HOSSAIN-1232BBA02170
WELCOME TO OUR
PRESENTATION

Presentation Topic
On
The International Development Association (IDA)
Table of Content

 History of IDA
 Purposes of Establishment of IDA
 Membership Requirement for IDA
 Role in Global Trade and Business
 Major Function of Development
 Evaluation of IDA
History of IDA
 The International Development Association (IDA) is an international
financial institution which offers confessional loans and grants to the
world's poorest developing countries. The IDA is a member of the
World Bank Group and is headquartered in Washington, D.C., United
States. .IDA was launched on September 24, 1960 with an initial
funding of $912.7 million with 15 signatory country. Within first eight
month of launch, IDA had 51 members and allocated credits worth
$101 million to four countries. These countries are Honduras, Chile,
Sudan, India. IDA has grown to include 172 member countries and
has become the leading source of confessional lending to 77 of the
world’s poorest countries. IDA credit and grants have totaled $2.93
billion now. Where the last three year average is $18 billion. The
association shares the World Bank's mission of reducing poverty and
aims to provide affordable development financing to countries whose
credit risk is so prohibitive that they cannot afford to borrow
commercially or from the Bank's other programs.
Purposes of Establishment of IDA
1. To help the earth’s poorest countries reduce poverty by providing
no-interest loan.
2. To boost economic growth /to promote economic development,
3. Improving living conditions
4. To reduce inequalities both across and within countries by allowing
more people to participate in the mainstream economy
5. The IDA lends to countries with the aim to finance projects that will
develop infrastructure and improve education, healthcare, access to
clean water and sanitation facilities, and environmental
responsibility.
6. IDA’s long-term (stretched over 35 to 40 years), no-interest loans
pay for programs that build the policies, institutions, infrastructure
and human capital needed for equitable and environmentally
sustainable development.
Membership Requirement for IDA
1. The original members of the Association shall be those members of
the Bank listed in Schedule A hereto which, on or before the date
specified in Article XI, Section 2 (c), accept membership in the
Association.
2. Membership shall be open to other members of the Bank at such
times and in accordance with such terms as the Association may
determine.
3. Upon accepting membership, each member shall subscribe funds in
the amount assigned to it. Such subscriptions are herein referred to
as initial subscriptions.
4. The initial subscription assigned to each original member shall be in
the amount set forth opposite its name in Schedule A, expressed in
terms of United States dollars of the weight and fineness in effect on
January 1, 1960.
5. The Association shall accept from any member, in place of any part
of the member's currency paid in or payable by the member under
the preceding subsection.
Role in Global Trade and Business
1. IDA provides leadership on global challenges.
2. IDA is transformational.
3. IDA is there for the long haul.
4. When the poorest are ignored because they’re not profitable,
IDA delivers.
5. IDA makes the world a better place for girls and women.
6. Working with the World Bank Group, IDA brings an integrated
approach to development.
Major Function of Development

International
Development
Association

Terms IDA'S Evolving

Activities IDA Operations
of IDA Lending Role
Major Function of Development
 Financial Resource:- The IDA's funds are obtained from three main
sources: members' subscriptions; periodic "replenishments" provided by
richer members and certain special contributions; and transfer of income
from the IBRD and repayments on IDA credits. While IBRD raises most of
its funds on the world's financial markets, IDA is funded largely by
contributions from the governments of the richer member countries. As of
September 2002, their cumulative contribution since IDA's beginning
totaled US $109 billion.

 Terms of IDA Lending :-IDA provides credits to its borrowers, interest-

free with a 35-to 40-year final maturity and a 10-year grace period.
Although IDA does not charge interest, it does charge a small
administrative fee of 0.75% against the outstanding balance of credits to
meet administrative expenses.
Major Function of Development

 IDA Operations :-While the IDA's financial terms are liberal, its
economic and technical criteria for development credits are exactly
the same as those applied by the IBRD in lending on conventional
terms. Each credit must be justified by the borrowing country's
economic position, prospects, and policies. Credits are extended
only for high-priority purposes.

 IDA'S Evolving Role:-IDA has taken an active role in helping

governments undertaking structural adjustment to protect and
expand social and environmental programs. It supports rural
development programs and projects which aim to increase
agricultural productivity and ensure adequate food supplies. IDA
also finances projects that give special attention to improving
women's incomes and status in their communities.
Evaluation of IDA
1. IDA is also a global leader in transparency and undergoes the
toughest independent evaluations of any international organization.
2. In 2012, IDA was hailed as a global aid transparency leader by
Publish What You Fund, a UK-based coalition of civil society
organizations working on governance, aid effectiveness, and access to
information. IDA was ranked 2 out of 58 donors in the index.
3. Equally, a 2011 assessment by the Center for Global Development of
the quality of aid from donor countries and aid agencies showed that
IDA, as well as a handful of other multilateral funds, spent aid money
“smarter” than most bilateral funds.
THE END