Wednesday, December 5, 2012

World Bank grant vs. drowning in debt

So, just imagine that: you are drowning in debt already, your corruption index is high, your doing business index pretty low. You just signed a deal for a railway that has the value of 80 percent of your yearly GDP. But you need more money, mainly for administration. What you do? Go to the World Bank. They don't care much what your credit ranking is. Once they started a project, they will go on and on, ignoring what happens in between.

Thats the prelude for the good news we received today:

"2012 – The World Bank Board of Executive Directors today approved US$ 4 million in grant financing for the Second Trade Development Facility (TDF-2), co-financed with a Multi Donor Trust Fund of US$ 10 million with contributions from Australia, the European Union, Germany, and Ireland. The grant builds on the progress of the original US$ 7.6 million project, which was approved in 2008. "

What is a bit confusing is the headline:

"Firms, entrepreneurs and employees in Lao PDR to benefit from improved business environment"

Main problems for companies here are actually lack of access to financing, labour law, lack of skilled people, lack of laws and security for your assets.

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