World Bank To Implement Fincl Support Package With Romanian Govt

The World Bank support is subject to approval from its Executive Board.

The World Bank support would focus on longer-term structural issues in three key areas, namely public sector reforms, notably in fiscal/public financial management to improve the transparency and predictability of public spending and quality of public services, the strengthening social protection (social assistance and pensions) to cushion the impact of the crisis on the vulnerable and improve the efficiency and viability of these programs; and the financial sector reforms to enhance the resilience and functioning of the sector.

In the public sector, the Bank would support measures that would help to improve the quality of public spending over time.

In the area of social assistance, the measures would involve increasing the funding of well-targeted programs, and improving the targeting, design and management of social protection programs. In pensions, the Bank would support measures to protect the living standards of retirees by improving the fiscal sustainability of the public pension scheme, and protecting and strengthening the integrity and equity of the multi-pillar pension system.

In the financial sector, the Bank’s focus would be on medium-term reforms that complement those covered by the IMF program.

These measures are part of the support package granted Romania, which equally include a EUR1 billion on a five-year period.

The financing would be provided in the form of series of Development Policy Loans (DPLs) disbursed over the course of 24 months. The Bank would expect to be able to disburse part of the loan balance in 2009 and part in 2010 provided that progress is made on achieving the reform measures.

In addition to the program of DPLs, the Bank continues to have an active engagement with Romania through a large portfolio of investment operations in social cohesion, agriculture, environment, health and education, knowledge economy, energy, natural and hazard mitigation, and the judicial system.