World Bank helps Indonesia`s reform and infrastructure

Hanoi (ANTARA News) - The World Bank (WB) has approved two development policy loans (DPLs) amounting to US$800 million USD to add momentum to Indonesia`s pro-poor reforms and infrastructure programme, said a WB statement issue on Wednesday.

The US$600 million Fourth Development Policy Loan and the US$200 million First Infrastructure Development Policy Loan bring together the Asian Development Bank (ADB), the Japanese government and the World Bank (WB) on a common platform to support Indonesia`s growing reform agenda, the statement added.

These low-cost loans are part of the Indonesian government`s strategy to reduce the country`s debt levels, which have been declining the fastest in East Asia from 80 percent of the GDP in 2000 to 35 percent by December 2007, and to make use of the lowest cost options for meeting financing requirements, the statement was quoted by VNA as saying.

These new loans have no commitment fees, which were abolished as part of a broader reform to reduce and simplify WB loan pricing in September 2007.

They also carry significantly lower interest rates and longer maturity than private financial market borrowings, allowing Indonesia to save in total debt service payments over the life of the loans.