JEDDAH: World Bank President Robert Zoellick has backed Custodian of the Two Holy Mosques King Abdullah’s energy-for-the poor initiative and said the bank would work with Saudi Arabia to support the $1 billion program.
“We will work with the Saudi government to explore how best to support the initiative announced by King Abdullah to address the energy needs of the world’s poorest countries,” said Zoellick. “The combination of high fuel and energy costs is having a devastating impact on the poor, putting a huge burden on the one billion people who live on less than $1 a day and many of whom spend two-thirds of their income on food for their families and on energy and transport.”
King Abdullah announced the initiative while opening a meeting of oil producers and consumers at Jeddah Hilton on Sunday. He called on the Saudi Fund for Development to allocate $500 million in loans for the energy needs of developing countries.
“World Bank research suggests that high energy prices will result in economic growth in about 40 developing countries being between three and 10 percent lower than it would have been otherwise — affecting millions of people,” Zoellick said stressing the significance of the king’s initiative.
In his keynote speech at the energy summit, King Abdullah said: “I call for launching an ‘Energy-for-the-Poor’ initiative. Its aim will be to enable developing countries to confront the increasing costs of energy, and I call on the World Bank to organize a meeting as soon as possible for donor countries and regional and international financial institutions to discuss and activate this initiative.”
Suleiman Al-Harbash, secretary-general of the OPEC Fund for International Development, said King Abdullah’s directive to the Ministerial Council of the Organization of Petroleum Exporting Countries (OPEC) to commit $1 billion to the initiative would help more than 100 countries to carry out new energy projects.
He said an extraordinary meeting of OPEC’s ministerial council would be convened to approve the initiative.
“Once the $1 billion initiative is approved, the amount will be given to projects related to energy production in poor countries such as setting up power plants and building dams to generate electricity,” Al-Harbash said, adding that the beneficiaries would include African, Asian and Latin American countries.
“We have received applications for loans from several countries and we finance projects in association with other international funds such as World Bank, Islamic Development Bank, Saudi Fund for Development, Kuwait Fund for Arab Economic Development and Arab African Fund,” he explained.
Ever since its establishment in 1976, the OPEC Fund has provided $9 billion in loans to finance development projects in more than 100 countries, he said, adding that about 20 percent of the amount was allocated for energy projects. Saudi Arabia is the largest contributor to the fund with a stake of 35 percent.
