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Market Commentary and Intraday News

Deal signed to clear Myanmar debt, allow new loans

113 days ago

(AP:YANGON, Myanmar) The World Bank has announced a long-awaited deal to allow Myanmar to clear part of its huge decades-old foreign debt, opening the door for much-needed lending to jump-start its lagging economy.

The bank's Washington headquarters announced Sunday that the Japan Bank for International Cooperation, the country's overseas development bank, will provide a bridge loan to Myanmar to allow it to cover outstanding debt to the World Bank and the Asian Development Bank, which totals $900 million.

Myanmar stopped payments on its old loans about 1987, making it ineligible for new development lending.

The deal is a major breakthrough for Myanmar, with loans likely to go to upgrading its dilapidated infrastructure. The knock-on effect would be to bring in more foreign direct investment, already attracted by the country's relatively low-cost economy.


Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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