Bangladesh local government to get $410m infrastructure boost

10 Feb 14
Local government in Bangladesh is in line for a boost after the World Bank today approved a $410m financing agreement to fund infrastructure improvements.

By | 10 February 2013

Local government in Bangladesh is in line for a boost after the World Bank today approved a $410m financing agreement to fund infrastructure improvements.

The Municipal Governance and Services Project aims to improve the provision of basic urban services by local bodies located along growth corridors from Dhaka towards Chittagong, Rangpur, Shylhet and Mymensingh.

Services to benefit from the project include road building, water and sanitation systems, bus terminals, markets and municipal service centres. The project will also strengthen the ability of municipal bodies to mount effective response operations during major emergencies.

A performance-based evaluation and allocation system will reward those municipalities that perform well with additional investment funds. Performance will be measured by improvements in governance, financial management, revenue enhancement and capital investment planning.

Johanness Zutt, World Bank country director for Bangladesh, said: ‘Bangladesh’s vision for becoming a middle-income country is ambitious, but not impossible. To achieve this goal, it will need to boost its competitiveness and grow at an even faster pace than the last decade.

‘With nearly one-third of the population living in urban centres, they can become the engine of growth if local urban bodies are able to deliver essential services and make cities liveable.’

Meanwhile, the World Bank has released $125m in additional financing for the ongoing Higher Education Quality Enhancement Project.

This project began in 2009 and aims to introduce innovation, accountability and better research facilities in public and private universities across Bangladesh.

Mohammad Mejbahuddin, Bangladesh’s economic relations secretary, said the higher education project would Bangladesh produce more skilled university graduates.

Both the projects will ultimately boost economic growth of the country,’ he added.

The $535m backing both projects has been released by the International Development Association, the World Bank’s concessional lending arm. The credit has 40 years to maturity, including a 10-year grace period, and carries a service charge of 0.75%.

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