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Indonesia gets US$500 mln loan from World Bank

JAKARTA (Rambu Energy) –World Bank board of executive directors approved  US$500 million in additional financing for Indonesia to support the country’s local government and decentralization project, which aims to improve local governments’ accountability in implementing infrastructure projects.

“Government accountability has a direct impact on the quality of services that communities receive: the more accountable, the better the services. This project aims to increase the efficiency and effectiveness of local government spending on vital infrastructure projects, such as roads, irrigation networks, clean water services and sanitation,” said World Bank Country Director for Indonesia, Rodrigo Chaves.

World Bank said in a statement that the project responds to the government’s request to scale up the project to 30 of Indonesia’s 34 provinces.  Four provinces that have special autonomy status: Aceh, Papua, West Papua, and Indonesia’s capital, Jakarta were excepted from this project. This additional financing is the second phase of a project that began in 2010.

The project will be carried out through improved financial and technical reporting, and verifications of services delivered as funded by the annual Special Allocation Funds (DAK) grant, as well as contributions from local government

The project also includes capacity building activities for financial management, procurement, investment planning and maintenance, safeguards management, and ensuring accountability. (*)

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