Addressing a joint press conference with Saudi Minister of Finance Dr. Ibrahim Al-Assaf after their talks, Kim highlighted the need of the international community providing more help to the two countries.
Kim, who is on a four-day trip to Saudi Arabia, Lebanon and Jordan, said he seeks to deliver messages about the importance of economic partnerships, good governance, transparency, and jobs for women and youth.
He recalled the World Bank estimated in the last summer the losses of the Lebanese economy due to the Syrian crisis at USD 7.5 billion.
He reaffirmed the commitment of the World Bank to scaling up support for countries in the Middle East undergoing political transition.
“I visit the Middle East at a moment of tremendous challenges. I am optimistic, however, that a brighter future for the next generation is within reach,” said Kim.
He noted that the World Bank Group is working with development partners to “provide all the necessary support at this critical juncture.” That includes financial commitments, which have been steadily growing in recent years and now stand at USD 16 billion in the region. New commitments in fiscal year 2014 (July 1, 2013 to July 1, 2014) are close to USD five billion, he went on.
The Bank has also been sharing the lessons learned from its work around the world on how to turn a vibrant private sector into an engine of inclusive growth, and the role good governance and transparency play in creating effective and accountable institutions.
The the World Bank Group wants to strengthen partnerships with Saudi Arabia and Arab development funds to improve trade and transport within and between countries, and to scale up support for countries undergoing political transitions, among other initiatives.
Saudi Arabia contributed USD 3.25 billion to support Yemen’s transition process, and also co-hosted along with Britain the “Friends of Yemen” – a group of countries and intergovernmental organizations that came together to assist Yemen during the transition process.
Another focus of Kim’s visit is to affirm the World Bank Group’s support for Jordan and Lebanon, which have taken in close to two million Syrian refugees.
In Lebanon, roughly one quarter of the population is now Syrian. A World Bank assessment of the impact estimated that GDP dropped 2.9 percent a year between 2012 and 2014.
In addition, over that time, 170,000 Lebanese fell into poverty, the unemployment rate doubled to above 20 percent, and total economic losses in both public and private sectors were estimated at USD 7.5 billion.
In both Lebanon and Jordan, the refugees are putting an extra strain on services such as water and electricity, waste disposal, primary education, and health, as well as bringing increased competition for scarce jobs.
To help Lebanon, the Bank created a Multi-Donor Trust Fund for grants from donors and partners. Norway has already contributed, and France and Finland recently made pledges, with other donors expressing interest. The Bank has contributed USD 10 million from the State and Peace Building Fund.
For Jordan, the Bank provided rapid financial assistance of USD 150 million in July 2013 to help the country cope with the influx of refugees.
An additional USD 60 million grant was made in October 2013 by the Bank and a number of development partners including the United Kingdom, Canada, Switzerland, and the Arab Fund. An additional USD 250 million was approved on March 13, 2014.
The UN made its largest-ever humanitarian appeal for USD 6.5 billion for 2014 to support aid organizations’ response to the massive humanitarian needs in Syria and neighboring countries. Some USD 2.3 billion was raised at the January 2014 Kuwait Donor Conference.
“The international community needs to step up its support to the Jordanian and Lebanese hosting communities,” said Kim.
“The people of these countries have demonstrated unprecedented generosity. They should not be left to shoulder this crisis alone,” he added.
On his part, Al-Assaf said the development in Saudi Arabia is unlikely to be affected by the decline of the oil prices.
“Thanks to its cash reserves, the Kingdom maintains defense lines that make its national development sustainable and immune to the adverse impacts of oil price decline,” he explained.
Al-Assaf said that the annual data show that the private sector contributes up to 60 percent to the GDP, noting that this is a very good percentage.
He added that the national economic development programs tend to reduce dependence on oil revenues and diversify the sources of income, expecting the annual growth rate to exceed four percent in keeping with the IMF estimates.