WASHINGTON, November 18, 2010 – The World Bank’s Board of Executive Directors today approved a US$1 billion Public Sector Reform Development Policy Loan to the Kingdom of Thailand to help the Royal Government in its efforts to sustain economic recovery from the recent global economic crisis and improve the delivery of public services through the development of more effective public institutions.
The Development Policy Loan (DPL) provides long-term financing that will enable Thailand to diversify its sources of funding for much-needed public investments. The loan is being made in support of the strong public sector reform program that has been implemented over the past several years.
These reforms—which are designed to promote efficiency, accountability and results—are being implemented in several key agencies to improve public sector management in a number of important areas including budget formulation and execution, reporting and accounting, internal control and civil service administration.
“For some time, commentators have recognized that Thailand needs to increase its levels of public investment in order to remain competitive in this dynamic region. We are very pleased to be able to support the country to achieve this objective,” said Annette Dixon, the Bank’s Country Director for Thailand. “While Thailand has good access to financial markets, borrowing from the World Bank will help Thailand access longer term maturity financing in line with its longer term investment needs.”
Ms. Dixon also said that in approving the loan, the IBRD’s directors noted the considerable progress Thailand has made in strengthening its results-based approach to public administration, and improving the transparency and accountability of public financial management. “The World Bank has supported Thailand’s public sector reform program for more than a decade, and this loan has allowed us to deepen our cooperation.”
The loan complements support received from the Asian Development Bank (ADB) in September.
Thailand has been implementing its public sector reform program for more than a decade, since the 1997 financial crisis. The World Bank has consistently been engaged in providing support to this program through technical assistance and analytical work.
The loan is an IBRD Flexible Loan (IFL) with a maturity of 20 years, including an 8 year grace period.