World Bank Executive Directors Reaffirm Support for Lebanon

THE WORLD BANK

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Middle East and North Africa Region

World Bank Executive Directors Reaffirm Support for Lebanon

WASHINGTON / BEIRUT – August 2, 2007:          The World Bank’s Board of Executive Directors has approved a comprehensive program to assist in Lebanon’s recovery, reaffirming confidence in the country’s ability to overcome its current challenges and return to a sustainable growth path.

In a meeting Thursday, the Directors welcomed an Interim Strategy Note that builds on the grant emergency assistance program approved in the aftermath of the summer 2006 hostilities and the financial pledges made at the Paris III Donor conference in January 2007. It presents a program, for a period of 12 to 15 months, focusing on analytical assistance backed by financial resources to advance the implementation of the medium-term expenditure and social reform agenda.

The analytical program builds on the Economic and Social Impact Analysis, completed by the Bank in cooperation with the Government in November 2006, which provided the Government with information needed for the reform program unveiled at Paris III. 

The Interim Strategy Note includes two policy based loans for up to US$175 million. The first Reform Implementation Development Policy Loan for US$100 million takes a multi-sector approach to support the implementation of the Government’s reform efforts, focusing on the electricity and social protection sectors, as well as business environment modernization. The measures supported by the loan will free up public resources and benefit households and businesses alike with an impact on service delivery, employment and competitiveness. Social protection reform measure, meanwhile, will greatly benefit poor and vulnerable communities.

The Bank expects that quick, upfront progress in these sectors will catalyze donors to implement their Paris III pledges and thus pave the way for implementing broader and deeper reforms. The second loan for up to US$75 million will further advance the social protection measures.

The decision by the Executive Directors reaffirms the World Bank’s support for Lebanon’s recovery and reform program. Mr. Joseph Saba, Director of the Bank’s Middle East Department said: “Launching and sustaining progress for early and fundamental reforms is essential to achieving success for the overall reform agenda, encouraging the effective use of donor’s resources and putting Lebanon on a path to recovery. That is the core aim of the ISN and RIDPL approved by the Executive Directors.”

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For more information on the World Bank activities in Lebanon, please visit:

www.worldbank.org/lb