 Tirana, May 12, 2007-- A signing ceremony took place today in the Ministry of Finance for the Financing Agreement of Development Policy Operation (US$ 10 million). The agreement was signed by the Minister of Finance, H.E. Ridvan Bode and the World Bank Country Manager for Albania, Mr. Nadir Mohammed. The ceremony was held in the presence of senior government officials and World Bank project team members.
The Development Policy Operation is the first in a series of three Development Policy Operations (DPOs), designed to support some of the key aspects of the Government’s National Strategy for Development and Integration aimed at tackling the twin challenges of sustaining growth (primarily through private sector development), and improving delivery of public social services. A third objective, improving governance and strengthening accountability mechanisms, will be the main cross-cutting objective of the DPO.
Following these objectives, the DPO program is structured around three components:
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Improving the investment climate for private sector-led growth. This component will support Government plans to reduce constraints to growth by strengthening the regulatory environment for business, improving the functioning of land markets, and improving the oversight of the non-bank financial sector.
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Improving fiscal sustainability and effectiveness of public service delivery. The focus here will be on the health, social insurance and water sectors. Actions will address health financing, the health sector regulatory framework, the pension policy and its implementation, and the policy and incentive framework in the water sector.
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Improving public finances and public administration. The third component aims at improving public financial management, furthering reforms in public administration, and advancing decentralization by supporting the strengthening of local finances.
Expected program outcomes include reduction in business costs, more productive public expenditures and investments, improved management of the civil service, and progress towards more sustainable and effective public services in water, health and pensions. Over a longer-term, the program should also lay some of the key foundations for and thus contribute to increased exports and private sector investment, sustainable growth and reduction in corruption.
The credit has a maturity of 20 years, with a 10 years grace period.
Albania joined the World Bank in 1991. World Bank commitments to the country to date total approximately US$925 million for 64 operations.
For more information about these projects, please visit
http://www.worldbank.org.al
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