WORLD BANK APPROVES $70 MILLION TO REDUCE POVERTY IN NICARAGUA

Washington, January 22, 2004 –In support of Nicaragua’s efforts to maintaining economic stability, the World Bank today approved a $70 million, zero-interest balance of payments credit to advance the implementation of poverty reduction actions and fiduciary strengthening reforms.

“The World Bank recognizes the Nicaraguan administration’s significant accomplishments   in the fight against corruption, the restoration of economic discipline, and commitment to poverty reduction,”said Jane Armitage, the World Bank’s Country Director for Central America.

The Poverty Reduction Support Credit (PRSC) aims to improve the impact of public programs through increased efficiency of public sector spending and better donor coordination. The PRSC will focus on priority areas included in the four pillars of Nicaragua’s Poverty Reduction Strategy Paper (PRSP), including:

·         Building public institutions and governance;
·         Promoting the human capital of the poor and vulnerable population; and
·         Supporting growth and competitiveness

“In addition to supporting Nicaragua’s poverty reduction programs, the credit will help the country maintain a stable macroeconomic framework and improve the country’s investment climate, which will better position the country to benefit from regional integration initiatives, such as the Central American Free Trade Agreement,” said Amparo Ballivian, the World Bank’s Country Manager for Nicaragua.

The PRSC will contribute to Nicaragua’s poverty reduction efforts by increasing the accountability, responsiveness and effectiveness of the state, and by directly supporting several Millennium Development Goals, such as targets for primary school completion, improved child health and nutrition, improved water coverage, and improved reproductive and maternal health for women.

The $70 million credit from the International Development Association is repayable in 40 years, including 10 years of grace.

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  For more information on the World Bank's work in the Latin America and Caribbean region, please visit: http://www.worldbank.org/lac

For more information about this project, please visit: http://web.worldbank.org/external/projects/main?pagePK=104231&piPK=73230&theSitePK=40941&menuPK=228424&Projectid=P082885