OREANDA-NEWS. December 15, 2009. The World Bank (WB) and Belarusian government have signed an agreement for Belarus to take a USD 200 million Development Policy Loan (DPL).

The document was signed by Belarusian Finance Minister Andrei Kharkovets and Martin Raiser, Country Director for Belarus, Moldova and Ukraine.

The World Bank single-tranche loan has a maturity of 16 years including a six year grace period. The loan proceeds would be made available to the borrower upon loan effectiveness.

The World Bank Board discussed the DPL in the context of a mid-term review of the World Bank Country Assistance Strategy for Belarus (2008-2011). The World Bank expanded the scope and size of its financial assistance planned under the Strategy and included budget support through the DPL in reflection of significant changes in the external environment and acceleration in the pace of structural reforms in Belarus.

The Development Policy Loan supports a program of reforms built around two pillars. The first pillar aims at strengthening social assistance programs by making them more targeted to the poor, who are likely to be most affected by the impact of the global economic and financial crisis on the Belarusian economy. The second pillar supports the government’s liberalization program to promote private investment and job creation, including measures such as the inspections decree which would lift a significant burden from businesses, price liberalization measures (including the removal of restrictions of trade margins for most products), the gradual elimination of turnover taxes, and the preparation of key legislation to launch the privatization process.

Belarus joined the World Bank in 1992. Since then, the Bank’s lending commitments in Belarus totaled USD 643 million for nine projects; about thirty national programs received grant financing totaling USD 18 million. Belarus is currently using World Bank financing in four infrastructure projects.