Mizzima: Lenders preparing loans, grants for Burma

Lenders preparing loans, grants for Burma

US$1 billion will be pledged in loans to Burma when the world’s major lenders meet in Tokyo next month, a report said on Thursday.

The Japanese business daily Nikkei said international bodies were readying large-scale resumption of aid loans ahead of an International Monetary Fund (IMF) meeting on the sidelines in Tokyo in early October.

The World Bank, the IMF and the Asian Development Bank (ADB) are all considering loans worth up to US$900 million to support Burma's democratization and economic development, said the newspaper.

The Japan Bank for International Cooperation and other Japanese banks will likely offer bridging loans so that Burma can repay its past debts, it said.

The total amount of fresh loans will reach about US$1 billion, the paper reported.

Financial organizations such as the World Bank and the ADB were not able to offer aid to Burma as representatives from the United States opposed such plans in their board meetings, the Nikkei said. But Washington in July gave the green light to companies wanting to invest in Burma including in oil and gas.

On Wednesday Secretary of State Hillary Clinton told Burma’s leader Thein Sein that the US would lift an import ban on Burmese goods.

Japan, as the largest single creditor country, will sponsor the loan scheme and call for the World Bank, the ADB and other creditors to waive part of their past loans to Burma, the Mainichi Shimbun earlier reported.

Tokyo in April agreed to forgive 300 billion yen (US$ 3.9 billion) of the 500 billion yen it is owed by Burma. Resource-poor Japan is looking to foster growth in the resource-rich Mekong region, a part of the world that is also being courted by China.