Arrears to World Bank and Asian Development Bank cleared with Japanese support

Washington, January 27, 2013 - Myanmar and the World Bank Group today marked the beginning of a new phase in their partnership to accelerate reforms with the clearance of arrears to the Bank and the Asian Development Bank. The Bank Group is now fully engaged in supporting development programs to benefit all of the people of Myanmar, with financial and technical assistance. The Bank Group is currently in discussions with the government to identify priority needs.

"Myanmar has come a long way in its economic transformation, undertaking unprecedented reforms to improve people's lives, especially the poor and vulnerable," said Myanmar Country Director Annette Dixon.  "Much work remains to be done. We are committed to helping the government accelerate poverty reduction and build shared prosperity. The Bank's engagement, together with the ADB, the Government of Japan and other partners, will help attract investment, spur growth and create jobs."

On January 22. 2013, the World Bank Board of Directors approved a US$440 million Reengagement and Reform Support Credit to Myanmar. The Credit supports critical reforms being implemented by the Government to strengthen macroeconomic stability, improve public financial management and improve the investment climate. Its proceeds will also help the Government meet its foreign exchange needs, including repaying a bridge loan provided to it by the Japan Bank for International Cooperation (JBIC) to clear arrears.

Myanmar is rich in natural resources, including large natural gas reserves, and extensive agricultural potential, particularly in rice production, and after decades of international isolation, is already seeing increased trade and investment from the wider international community. Myanmar's economic growth accelerated to 5.5 percent in fiscal year 2011-12. GDP growth is expected to reach 6.3 percent in fiscal year 2012-2013.

Over the past year, the World Bank has opened an office in Yangon, appointed a country manager and brought in technical experts to undertake and support analytical, diagnostic and advisory work as Myanmar begins to prepare a broad development program. The Bank also provided a US$80 million grant to help finance the National Community-Driven Development project, which will enable villagers to develop rural infrastructure improvements including schools, health clinics, roads and irrigation schemes in about 640 village tracts across Myanmar over six years.