Announcement of World Bank Approves Two Hundred Million Dollars Loan for Structural Adjustment in the Philippines on September 18, 1980

£ FOR IMMEDIATE ·RELEASE 9/VorldBank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.• Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 81/15 September 18, 1930 World Bank Approves $200 Mill ion Loan for Structural Adjustment in the Philippines The World Bank has approved a $200 mill ion loan to the Philippines to assist the implementation of a program of structural adjustment. This is the first loan of its kind to an Asian nation since the World Bank began a new form of program assistance to help developing countries adjust to perma- nent or long-term changes in the world economic environment. The Philippines is one such country that has substantial long-term capital requirements. The loan will support the implementation of a comprehensive industrial development program designed to accelerate industrial growth, expand employ- ment and maintain the rapid growth of non-traditional exports. It is also expected to increase the efficiency of capital use and stimulate industry outside the Metropolitan Manila area. The government is undertaking a number • of measures to achieve these long-term pol icy objectives. Actions are being taken to promote exports to reform tariffs and liberalize trade and to revise investment incentives. Industrial restructuring programs and investments in selected major industrial projects are also planned. The initial phase of these pol icy reforms, to be supported by the World Bank loan, concentrates on export promotion, tariff reform and trade liberalization. The $195 mill ion worth of foreign exchange provided by the loan wi 11 be used for imports of industrial raw materials, intermediate and investment goods, and spare parts. In addition, the loan wi l I provide $5 mil lion to finance consultancy services to help the government formulate and implement industrial pol icy measures and programs. The $200 mil I ion World Bank Joan to the Republic of the Philippines is for 20 years, including five years of grace, with interest at 9.25% per annum. The import portion of the Joan wil 1 be disbursed in two tranches. The first tranche of $100 mill ion will be available for disbursement after the loan is declared effective, and the second, after a performance review, on January 31, 1981. The technical assistance component will be disbursed over a four-year period. • NOTE: Money figures are expressed in U.S. dol Jar equivalents .