INTERNATIONAL DEVELOPMENT ASSOCIATION

Abstract

This chapter discusses the functions of International Development Association (IDA). The IDA is a United Nations Specialized Agency. Its Articles of Agreement formulated by the Executive Directors of the International Bank for Reconstruction and Development (IBRD) and submitted to the IBRD member governments on January 26, 1960, entered into force on September 24, I960. The IDA provides long term, low-cost loans for development; it was created in the period of decolonization when many poor countries in need of development assistance were experiencing problems of credit worthiness and, therefore, were unable to borrow from IBRD on commercial terms. The purposes of the IDA are to promote economic development, increase productivity, and thereby raise standards of living in the less-developed areas of the world included within its membership. In particular, the IDA is to provide financing to meet the States' important developmental requirements on terms that are more flexible and bear less heavily on the balance of payments than those of conventional loans, thereby furthering the developmental objectives of the IBRD and supplementing its activities.