News / Asia

Lending Agencies Restart Burma Loan Programs

International lending agencies have agreed to restart loan programs for Burma after a 25-year break, rewarding that nation for reforms introduced since the end of a military dictatorship in 2011.
 
The Asian Development Bank and the World Bank said Monday that Burma's existing $900 million debt to the two agencies will be restructured, allowing them to offer additional loans in the future. 
 
Burma became ineligible for new development loans in 1987, when its then-military rulers stopped paying down existing debts. 
 
But, the reformist government that took office in 2011 received a $900 million loan from a Japanese development bank this month, enabling Burma to clear its debts to the two lending agencies. 
 
The two lenders said that move enabled them to offer $900 million in loans to Burma, so that it can repay its debt to the Japan Bank for International Cooperation. 
 
Asian Development Bank economist Kelly Bird said the restructured loan also will facilitate a resumption of work on developing the impoverished Burmese economy. 
 
"Over the next several months, we will be doing two things. ADB will be looking at what resources can be allocated to Myanmar. Secondly, we will develop our assistance program to build the capacity of authorities in economic policy. It also may include some projects focussing on infrastructure and agriculture," he said. 
 
Bird said the renewal of the lending program is a recognition of "wide-ranging" Burmese economic reforms in the past year. 
 
"They have introduced a new foreign investment law which has helped to open up opportunities for foreign investors. They are in the process of drafting amendments to the central bank law which would provide it with autonomy and lead to better macroeconomic stability. So they have got a number of these reforms that have been implemented," he said.
 
In a related move, an informal group of creditor nations agreed last Friday to cancel about $6 billion of Burmese debt in appreciation of what it called Burma's "strong commitment" to economic reforms. 
 
The canceled amount is half of the total debt owed by Burma to the 19 industrialized nations known as the Paris Club. The group said the remaining half of Burma's debt will be rescheduled over 15 years. 
 
Macquarie University analyst Sean Turnell said the renewal of the ADB and World Bank lending programs is a more significant step because it involves future loans to rebuild dilapidated Burmese infrastructure. 
 
"The cancelation of debts is not such an issue in that the old government of Burma just ignored them anyway, they were not repaying them. So, in a direct sense, it is not going to make too much of a difference. But of course symbolically and in terms of being embraced by the international community again, this is very significant," he said. 
 
A Burmese envoy to the Paris Club praised the debt cancellation as marking the start of a "new era" of cooperation with the industrialized nations. U Zaw Oo said Burma will devote resources made available by the move toward "development projects and poverty reduction programs."
 
Paris Club member Japan agreed to cancel $3 billion in Burmese debt, half of the group's total. 
 
Turnell said Japan has several motives for its generosity toward Burma, including commercial interests, with Japanese construction companies vying for infrastructure projects. 
 
"Also, Japan has an interesting relationship with Burma -- a sentimentality that goes back to the Second World War. There are many people in Japan who see their role as a bit of a mid-wife of Burma's independence. The final aspect though is strategic. Japan is involved in a big long-term struggle with China for influence throughout Southeast Asia. So this is also part of [Japan] sending that signal that they are close to Burma, and in that way, checking China, just a little bit," he said. 
 
The Paris Club said the cancellation of the $6 billion in Burmese debt will happen in two phases over several years. Turnell said Burma will be under pressure to make progress with economic reforms in order to qualify for the final phase of that debt relief.

VOA's Victor Beattie contributed to this report.

Michael Lipin

Michael covers international news for VOA on the web, radio and TV, specializing in the Middle East and East Asia Pacific. Follow him on Twitter @Michael_Lipin

You May Like

Photogallery Pistorius Sentenced, Taken to Prison

Pistorius, convicted of culpable homicide in shooting death of girlfriend Reeva Steenkamp, will likely serve about 10 months of five-year sentence, before completing it under house arrest More

UN to Aid Central Africa in Polio Vaccinations

Synchronized vaccinations will be conducted after Cameroon reports a fifth case of the wild polio virus in its territory More

WHO: Ebola Vaccine May Be in Use by Jan.

WHO assistant director Dr. Marie Paule Kieny says clinical trials of Ebola vaccines are underway or planned in Europe, US and Africa More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
After Decades of Pressure, Luxembourg Drops Bank Secrecy Rulesi
X
October 21, 2014 12:20 AM
European Union finance ministers have reached a breakthrough agreement that will make it more difficult for tax cheats to hide their money. The new legislation, which had been blocked for years by countries with a reputation as tax havens, was approved last week after Luxembourg and Austria agreed to lift their vetoes. But as Mil Arcega reports, it doesn’t mean tax cheats have run out of places to keep their money hidden.
Video

Video After Decades of Pressure, Luxembourg Drops Bank Secrecy Rules

European Union finance ministers have reached a breakthrough agreement that will make it more difficult for tax cheats to hide their money. The new legislation, which had been blocked for years by countries with a reputation as tax havens, was approved last week after Luxembourg and Austria agreed to lift their vetoes. But as Mil Arcega reports, it doesn’t mean tax cheats have run out of places to keep their money hidden.
Video

Video Kobani Refugees Welcome, Turkey Criticizes, US Airdrop

Residents of Kobani in northern Syria have welcomed the airdrop of weapons, ammunition and medicine to Kurdish militia who are resisting the seizure of their city by Islamic State militants. The Turkish government, however, has criticized the operation. VOA’s Scott Bobb reports from southeastern Turkey, across the border from Kobani.
Video

Video China Political Meeting Seeks to Improve Rule of Law

China’s communist leaders will host a top level political meeting this week, called the Fourth Plenum, and for the first time in the party’s history, rule of law will be a key item on the agenda. Analysts and Chinese media reports say the meetings could see the approval of long-awaited measures aimed at giving courts more independence and include steps to enhance an already aggressive and high-reaching anti-corruption drive. VOA’s Bill Ide has more from Beijing.
Video

Video US ‘Death Cafes’ Put Focus on the Finale

In contemporary America, death usually is a topic to be avoided. But the growing “death café” movement encourages people to discuss their fears and desires about their final moments. VOA’s Jerome Socolovsky reports.
Video

Video Ebola Orphanage Opens in Sierra Leone

Sierra Leone's first Ebola orphanage has opened in the Kailahun district. Hundreds of children orphaned since the beginning of the Ebola outbreak face stigma and rejection with nobody to care for them. Adam Bailes reports for VOA about a new interim care center that's aimed at helping the growing number of children affected by Ebola.
Video

Video Young Nairobi Tech Innovator on 'Track' in Security Business

A 24-year-old technology innovator in Nairobi has invented a tracking device that monitors and secures cars. He has also come up with what he claims is the most robust audio-visual surveillance system yet. As Lenny Ruvaga reports from the Kenyan capital, his innovations are offering alternative security solutions.
Video

Video Latinas Converting to Islam for Identity, Structure

Latinos are one of the fastest growing groups in the Muslim religion. According to the Pew Research Center, about 6 percent of American Muslims are Latino. And a little more than half of new converts are female. VOA’s Carolyn Presutti travelled to Miami, Florida -- where two out of every three residents is Hispanic -- to learn more.
Video

Video Exclusive: American Joins Kurds' Anti-IS Fight

The United States and other Western nations have expressed alarm about their citizens joining Islamic State forces in Syria and Iraq. In a rare counterpoint to the phenomenon, an American has taken up arms with the militants' Syrian Kurdish opponents. Elizabeth Arrott has more in this exclusive profile by VOA Kurdish reporter Zana Omer in Ras al Ayn, Syria.
Video

Video South Korea Confronts Violence Within Military Ranks

Every able-bodied South Korean male between 18 and 35 must serve for 21 to 36 months in the country’s armed forces, depending upon the specific branch. For many, service is a rite of passage to manhood. But there are growing concerns that bullying and violence come along with the tradition. Reporter Jason Strother has more from Seoul.
Video

Video North Carolina Emerges as Key Election Battleground

U.S. congressional midterm elections will be held on November 4th and most political analysts give Republicans an excellent chance to win a majority in the U.S. Senate, which Democrats now control. So what are the issues driving voters in this congressional election year? VOA National Correspondent Jim Malone traveled to North Carolina, one of the most politically competitive states in the country, to find out.
Video

Video Comanche People Maintain Pride in Their Heritage

The Comanche (Indian nation) once were called the “Lords of the Plains,” with an empire that included half the land area of current day Texas, large parts of Oklahoma, New Mexico, Kansas and Colorado.The fierceness and battle prowess of these warriors on horseback delayed the settlement of most of West Texas for four decades. VOA’s Greg Flakus reports from Lawton, Oklahoma, that while their warrior days are over, the 15,000 members of the Comanche Nation remain a proud people.
Video

Video Turkey Campus Attacks Raise Islamic Radicalization Fears

Concerns are growing in Turkey of Islamic radicalization at some universities, after clashes between supporters of the jihadist group Islamic State (IS) or ISIS, and those opposed to the extremists. Pro-jihadist literature is on sale openly on the streets of Istanbul. Critics accuse the government of turning a blind eye to radicalism at home, while Kurds accuse the president of supporting IS - a charge strongly denied. Henry Ridgwell reports from London.

All About America

AppleAndroid