Vientiane, August 14, 2014 – The Government of Lao PDR and the World Bank Group today signed two separate agreements worth up to USD$50 million.
The first agreement is aimed at making more credit available to small businesses in Laos through the Small and Medium Enterprise Access to Finance Project. The new support includes a USD$10 million grant, USD$10 million credit and USD$12 million in risk sharing funds. The project will provide long term credit to the small firms, with the view to helping them expand their job creation and productive activities.
“The ceremony today reaffirms the commitment and cooperation between the Government of Lao PDR and the World Bank in supporting Government priorities as outlined in our National Socio-Economic Development Plan. SMEs, hydropower and mining sectors form an important part of the Lao economy. The two projects will contribute to the socioeconomic development and environmental sustainability of Lao PDR”, said H.E. Mme. Thipphakone Chanthavongsa, Vice Minister of Finance of the Lao PDR.
The Government of Lao PDR and the World Bank Group also signed an agreement to support Lao PDR in the further development of the hydropower and mining sectors. Additional financing of USD$17.8 million for the Technical Assistance for Capacity Building in the Hydropower and Mining Sectors Project will help to improve the effectiveness of government institutions and build capacity in these sectors. This financing builds on the achievements of the original grant of USD$8 million approved in 2010, and a grant of USD$2.54 million from the Australian Department of Foreign Affairs and Trade.
“Financing for small firms is vital for the Lao economy. It will help to create more jobs and increase family incomes and revenues. Equally important will be the sustainable use of Laos’ wealth of hydropower and mining resources. The World Bank Group is pleased to offer its strong support for these two projects and looks forward to continuing our close partnership with Lao PDR”, said Mr. Ulrich Zachau, Country Director for the World Bank to Southeast Asia.