$410m WB credit for urban development

The World Bank (WB) on Thursday approved $410 million loan to improve municipal governance and basic urban services in district towns in Bangladesh.
This financial support of WB will be used to implement the ‘Municipal Governance and Service Project,’ which will cover 26 urban government bodies under the districts of Dhaka, Chittagong, Rangpur, Sylhet and Mymensingh.
It will also cover three district towns in the southern part of the country, a WB official in Dhaka adding that it will benefit 3.4 million people in urban communities across the country.
The ‘Municipal Governance and Service Project’ aims to build roads, water and sanitation systems, markets, bus terminals, and municipal services centers in these communities.
“Bangladesh experienced some of the most rapid urbanization in South Asia. Yet, the cities offer inadequate infrastructure and low levels of urban services, particularly in district towns and municipalities,” said Johannes Zutt, WB Country Director for Bangladesh.
He added: In response to urban governance challenges, this project aims to make the urban local bodies become strong, responsive and inclusive local government institutions able to provide better urban services and undertake immediate response operations in times of major emergencies.
The country’s urban population increased from 15 per cent in 1980 to 28 per cent in 2010. Municipalities and towns play key roles in supporting economic growth, jobs creation and poverty reduction and are growing rapidly.
“Bangladesh represents a remarkable development story. It reduced the number of people living on less than $1.25 a day from 58.6 per cent in 2000 to 43.3 per cent in 2010 – a rate that was 60 per cent faster than the rest of the developing world except China,” said Johannes Zutt.
He also said that for the WB, Bangladesh is an important partner in its global goal of eliminating extreme poverty and boosting shared prosperity by 2030. “We are committed to supporting Bangladesh’s goal of becoming a middle income country by its 50th Birthday,” he said.
“The project incorporates a number of innovations to improve municipal governance and basic urban services,” said Shenhua Wang, Senior Urban Specialist at the WB.
The application of a performance-based evaluation and allocation system would reward urban government bodies with more funds based on improvements in governance, citizen participation, capital investment planning, financial management, and revenue enhancement, he added.

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