Don't Miss


Home   >   Market - Finance   >   Finance   >   World Bank defends $75m loan to Edo

World Bank defends $75m loan to Edo

By on October 16, 2015

The World Bank has defended its $75 million loan to Edo State Government, saying it grants significant funding only to governments it trusts would use the funds judiciously to achieve its development results.

Speaking on Wednesday at a three-day retreat for members of the State Executive Council and Permanent Secretaries holding at the Transcorp Hilton Hotel, Abuja, to brainstorm and re-strategise on raising the bar on governance in the state, with the theme, ‘Finishing Well’, two top executives of the World Bank, Mrs. Gloria Joseph Raji and Dr. Khwima Nthara said the bank trusts Edo State Government to use the fund properly as it only provides support to governments the bank trusts to use its funds for development results.

The Bank executives said: “Each time we came to Edo, we were quite impressed that we were taken around to see the results of these reforms and that is why it was easy for us at the world Bank to sell the reforms programmes in Edo to our Board in Washington.”

Mrs. Gloria Joseph Raji, Senior Economist, Macro-Economic and Fiscal Management, World Bank, Nigeria said, “through programmes for result financing, the World Bank provides finance for governments with a focus on result and capacity building. So disbursement of funds is based on specific programme results that have been pre-agreed on between the bank and respective governments.

“For example, we could say, if you achieve this level of vaccination with your own resources, then we will disburse some money to you.”

Mrs. Joseph-Raji continued, “When we disbursed $75 million under the First Developmental Policy Operation to Edo State, we did not say to Edo State, you must use it to build this hospital, or this school or all of that, it was on the basis of your completion of critical policies and institutional actions which we call ‘prior actions’.

“So, the focus of Developmental Policy Financing is policy and institutional reforms. We work with you to implement certain policies and institutional reforms and on the basics of implementation of certain critical reforms and actions that we agreed on, we will disburse the entire trunk of the funds.”

She emphasised the need for institutional reforms as this she says, ensures continuity of government developmental programmes even after their tenure.
She said: “Institutional reforms are very important because they outlive government regimes so, it is important for governments to undertake reforms of their systems and processes, institutionalised them and that is what the focus of DPO are, to support policies and institutional reform efforts and the bank is usually on hand to provide Policy and strategic advice, so we work with the governments in designing, in thinking through your policy and institutional reforms actions and then we provide advice as necessary.

“On the basis of the completion of certain critical policies and institutional reforms actions which has been agreed between you and the bank, the loan is approved by the bank and so, funds are  transferred. The entire trunk of funds is transferred into the government bank account and they are co-mingled with your other funds. The funds are not tied to specific projects, you co-mingled them into your funds and you spend them on your needs.”

She stressed, “The Bank provides significant funding to only governments it trusts will use the funds properly to achieve its development results because if we do not trust that you will use this fund judiciously, it would be a risk of the fund. So DPO’s are provided basically to those governments that the bank trusts to use the funds for development results.”

Also speaking, the Programme Leader, Equitable Growth, Finance and Institution, World Bank, Nigeria, Dr. Khwima Nthara said: “Reforms have to be institutionalised. Edo is very lucky today to have a very reform-minded governor, next year, he leaves office. We pray that a like-minded governor takes over from him but circumstances change, you don’t know who else is going to come with the Governor and that is why it is important to institutionalize reforms so that they should transcend individual personality.

“Even when Comrade Adams Oshiomhole is not here, his legacy should remain, not just what he has achieved, but the building blocks of the reform programmes must remain so that even when the regime changes, the reforms might stay. That is why institutionalising those reforms are important.

The World Bank team noted that of the 36 states of the federation, only Lagos and Edo State Governments as well as the federal government have been able to access this developmental funds and therefore called on other state governments to embark on critical, efficient and developmental reform projects to enable them quality for the World Bank Developmental funds.

 

 

[ThisDay]