WB approves $1.1b emergency support to safeguard Bangladesh's food security
The global lender stepped up with immediate support as rising food, fertiliser, and fuel prices stemming from the US-Israel war on Iran, which has culminated in a broader Middle East conflict
The World Bank has approved $1.1 billion for two projects to help Bangladesh mitigate the price and supply volatility in global fertiliser and fuel markets, sustain food security, and enable a rapid response to economic shocks.
The global lender stepped up with immediate support as rising food, fertiliser, and fuel prices stemming from the US-Israel war on Iran, which has culminated in a broader Middle East conflict, according to a press release issued yesterday (26 June).
The global shock, alongside a tighter fiscal space, has deeply impacted Bangladesh's economy, hitting smallholder farmers and vulnerable populations the hardest, it said.
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World Bank Division Director for Bangladesh and Bhutan Jean Pesme said, "Rising food, fertiliser, and fuel prices stemming from the Middle East Conflict, along with tighter fiscal space, have deeply impacted Bangladesh's economy, hitting smallholder farmers as well as poor and vulnerable people the hardest."
He added that the financing aims to ensure fertiliser supply for rice production, protect households, jobs, and livelihoods, and maintain essential services.
Of the total funding, the Emergency Support for Food Security Project will provide $300 million in time-bound financing to help Bangladesh import fertilisers critical for the upcoming Aman and Boro cultivation seasons, spanning July-October this year and from October to April next year, respectively.
Bangladesh currently imports more than 85% of its fertiliser requirements, said the World Bank.
This project, it said, will finance the import of 6,00,000 tonnes of critical fertilisers – half of which will be Urea – covering 1.4 million hectares of rice production cultivated by smallholder farmers.
Souleymane Coulibaly, World Bank lead economist and task team leader for the project, emphasised that Bangladesh's food security heavily relies on the Aman and Boro seasons, which together account for about 90% of the country's total rice production.
"About half the population is employed in the agriculture sector. So any disruption in fertiliser supply would not only threaten food security, it would deepen poverty and cost jobs," Coulibaly added.
Regarding the remaining $713 million, the release clarified that it will fund the Contingent Emergency Response Project, which supports quick-disbursing emergency expenditures.
This includes cash transfers and livelihood assistance for affected households and micro, small, and medium enterprises to stabilise incomes and preserve jobs during crises, stated the lender.
It will also finance fuel and energy supplies to ensure the continuation of essential services, including food, medicines, medical equipment, energy, and water.
The project, which utilises the World Bank's crisis preparedness and response toolkit by repurposing unutilised financing from existing projects, will disburse the funds by 30 June.
"This project will provide Bangladesh immediate access to funds through the World Bank's crisis preparedness and response toolkit by repurposing unutilised financing from existing projects, directing resources where they are most needed and protecting people, businesses, and jobs from the impact of shocks," said Lesley Jeanne Yu Cordero, World Bank lead disaster risk management specialist and task team leader for the project.
