Sunday, May 28, 2006

China getting 1.5 billion dollar loan from World Bank for infrustructural development

World Bank has decided to lend China 1.5 billion dollars to develop its infrastructure and overcome its challenges. The loan will be given in small amounts starting from 2006 and ending in 2010. The majority portion of the loan will be used in projects aimed at reducing poverty in rural China. In addition, the loans will be used to deal with issues such as, rapid industrialization, environmental problems, resource management, growing inequality between village and city population and so on. I am quoting from the report:
About 70 per cent of the proposed projects using the loans through the International Bank for Reconstruction and Development will be in China's poorer inland provinces, the bank's China office said in a statement on its newly-endorsed strategy for the country for five years.
According to the strategy approved last week by the World Bank, the bank will help China integrate itself into the world economy, address poverty and inequality, manage resource scarcities and environmental challenges during 2006 and 2010, the statement said.
It will also help China strengthen the financial sector, and improve public and market institutions.

According to World Bank President, Paul Wolfowitz, to increase the economic strength of China is very important for the world economy. China, at present, has a population of 1.3 billion. It has world’s third largest economy and the fourth largest trading nation. Although Communist, the country reformed its strategies and observed a rapid growth since 1978. China today has acquired the top position in manufacturing.
Despite these advancements it is considered as a developing country because of its poverty. The people of rural China are very poor and according to the World Bank their daily income is less than one dollar per day. Yet, China’s private sector is increasing at a rapid pace and only few cities of China is getting all the facilities. If such inequality remains then it would create serious problem. Hence, World Bank has decided to help China smooth its problems and integrate the country into Global business.

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