The World Bank has agreed to provide US$ 100 million in low-cost loan to help the government carry out reform in public financial management.
The Washington lender's assurance came after the Economic Relations Division recently sought the support for carrying out the financial management reform needed to achieve the national goals.
"We are pleased to inform you that the World Bank stands ready to support government of Bangladesh in its implementation of the public financial management reform strategy 2016-2021 and action plan," the bank's acting country director Rajashree S Paralkar said in a letter to the ERD.
She also wrote that the global lender is agreeable to providing the loan from the International Development Association, the bank's soft-lending arm.
The IDA financing is meant to support Bangladesh in carrying out priority activities of the action plan related to the reform.
Bangladesh is one of top recipients of the IDA loan as a least developed country. As the country has just become eligible for graduating to a developing country status, the scope for getting low-cost loans will be slimmer, according to finance ministry officials.
According to finance ministry officials, the government has continued such reform since 2007 to ensure better fiscal transparency and accountability across all the sectors.
The objective of the reform strategy through 2021 is to ensure that there are solid basic public financial management practices in place, while at the same time building upon and institutionalising the innovations of the last reform strategy ending in 2012.
A finance ministry document said the purpose of the new strategy is to build on the past reforms and learn from what has worked and what has not in order to strengthen the "basics required for achieving the overarching national goals".
"Some PFM reform innovations are struggling to take hold, such as the development of a medium-term horizon when preparing budgets, and strengthening the linkages between budgets and policies," said the document.
"Others are picking up but yet to make a tangible difference - such as the development of a new chart of accounts or the roll-out of a new financial management information system," it said.
The new strategy will learn from these past reform efforts to ensure that the strategy has realistic ambitions, is focused on the priority reform areas and is tailored to the capacity of the staff members.
To reach the new national objectives, the document noted, "The public financial management system needs to be able to deliver several improvements; such as a broader tax base and higher government revenues, a programme of public investments to build core infrastructure, and social expenditures that can deliver protection for the poor and vulnerable."
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