World Bank Group to Support Job Creation and Resilience in Armenia

WASHINGTON, Jan. 21, 2025-The World Bank Group's Board of Executive Directors today endorsed a new five-year Country Partnership Framework (CPF) for Armenia. The framework aims to reduce poverty and promote prosperity across the country by creating better job opportunities, improving human capital outcomes, and enhancing resilience.

Armenia has made significant development gains in recent years. However, infrastructure gaps, low levels of domestic and foreign investment, and high levels of unemployment remain as key challenges to growth. Armenia's uneven education and health outcomes create limitations to the employability and productivity of the population. The social protection system requires reforms to better target and support vulnerable populations in times of crisis. Armenia also faces major risks from earthquakes and is increasingly vulnerable to the impacts of climate change.

The new strategy emphasizes the need for a stronger focus on building resilience to economic shocks, fragility and conflicts, natural hazards, and climate change. The proposed CPF will help Armenia in achieving:

• More and better jobs by ensuring better conditions for private sector growth and addressing skill gaps in the workforce.
• Stronger human capital by enhancing access to quality healthcare and improving social protection.
• A resilient economy by advancing climate-adaptive economic activities and strengthening government and organizational systems, including public financial management, strategic planning, and public administration reform.

"This new partnership framework is a testament to our commitment to supporting Armenia in building a more sustainable, resilient, and inclusive economy," said Carolin Geginat, World Bank Country Manager for Armenia. "By focusing on job creation, human capital, and resilience, we aim to improve the lives of Armenians and help the country navigate future challenges."

The new strategy emphasizes mobilizing private capital through close collaboration across the World Bank Group's institutions: the International Bank for Reconstruction and Development (IBRD), the International Finance Corporation (IFC), and the Multilateral Investment Guarantee Agency (MIGA). IBRD expects to fund around $1 billion over the next five years to promote reforms that would allow IFC and MIGA to attract more private capital.

IFC, with its focus on the private sector, plans to boost investments in infrastructure and real sectors, including through public-private partnerships (PPPs). Under the CPF, IFC will aim to support the private sector's contribution to sustainable infrastructure development, such as green energy, water, connectivity, and greener transport. IFC will also work with financial institutions to broaden the reach of climate-focused products, support sustainable finance, promote green bonds, and advance digital transformation. IFC's investments are expected to range from $500 million to $700 million.

"We are committed to driving private sector growth in Armenia by leveraging our expertise in sustainable finance and mobilizing private capital," said Ivana Fernandes Duarte, IFC's Regional Manager for the South Caucasus. "Through our collaborative efforts under the new strategy, we aim to promote green development, ensuring long-term environmental and economic well-being for the country."

The World Bank is committed to continuing its support to Armenia in its development path for reducing poverty and creating a more prosperous and resilient future. Since 1992, the World Bank has provided around $3 billion, including a current portfolio of around $400 million in investment lending, grants, analytical work, and technical assistance, to Armenia from the International Bank for Reconstruction and Development (IBRD), trust funds, and the International Development Association (IDA), to which Armenia also became a donor in 2023. IFC has invested nearly $1.3 billion in Armenia, including mobilization, since it became a member country in 1995, and MIGA has investment nearly $39 million.

Contacts

In Yerevan: Hasmik Soghomonyan, +374 91291300, [email protected]

In Tbilisi: Tamar Barbakadze. +995 (32) 223 43 00, [email protected]

In Washington: Christopher Walsh, +1 (202) 473-4594, [email protected]