Bank officials say there is a substantial financial burden being borne by Lebanon and Jordan.
They are discussing help from rich countries and from Gulf nations.
They
say the idea has been well received by potential contributors and hope
to have the first funds paid out in four to six months.
The
arrangement under discussion is one in which the Bank would make loans
to Jordan and Lebanon, with aid donors covering at least some of the
interest costs.
Millions of refugees are now in countries
bordering Syria. The largest number are in Turkey, but it is the much
smaller economies of Lebanon and Jordan that face far greater financial
strain.
'Global public good'
In Lebanon the number is equivalent to 30% of the population. In Jordan the figure is 20%.
The
cost to government budgets comes from the 85% of the refugee population
that live in normal housing rather than camps, where the costs are
borne by the United Nations.
For
those not in camps there is a cost in terms of healthcare and
education. There is also water supply and electricity. Even if they pay
the bills these prices are often subsidised so the presence of the
refugees adds to the total cost to the government.
By hosting the refugees the countries concerned are providing what a
World Bank economist called a "global public good". So there is a
willingness to help with the cost.
But Lebanon and Jordan are
classified as middle income countries. The World Bank can't provide them
with grants or cheap loans. It can only do that for low income nations.
For middle income countries it can lend but at an interest rate that
in essence covers the Bank's own borrowing costs.
Lebanon and
Jordan are reported to be reluctant - understandably, you might say -
to pay interest for dealing with a problem not of their own making.
So
the World Bank is instead proposing to provide the loans while aid
donor nations ease the financial burden by covering some of interest
payment costs. It's not as direct a way of helping as grants would be,
but it could make a significant difference.
The likely
contributors to any such funding are the G7 - the largest developed
economies, Gulf states and some smaller European nations.
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