The IDB supports the development of its lowest income member countries through allocations of resources with a significant grant element/level of concessionality. To be eligible for concessional resource allocations, a country must meet at least one of two eligibility criteria: an income per capita below US$2,834 in 2015 prices, and/or a lack of creditworthiness to borrow solely on regular Ordinary Capital terms, as judged by a “synthetic creditworthiness indicator”.
Countries that are eligible for country allocations of concessional resources receive allocations on a biennial basis, and they have the freedom to use the biennial allocation at any point in time during the biennial allocation period. Concessional resources are allocated through a performance-based allocation (PBA) formula that takes into account country needs (income per capita and population) and performance, as measured by a Country Institutions and Policy Evaluation (CIPE) and a portfolio performance indicator.
The financial composition (and hence the level of concessionality) of a country’s biennial allocation depends on: the country’s per capita income; its degree of vulnerability and fragility; its risk of debt distress (using the Joint World Bank-IMF Debt Sustainability Framework for Low Income Countries); and the amount of non-concessional external debt the country has.
An overview of the IDB’s concessional resource framework is available in “A Compilation of the IDB's Framework for Concessional Resources”.