Financial Times

ADB to approve new US$80 million loan
The Asian Development Bank is to approve a loan of $80 million for rehabilitation work in the north and east this week.

This is the first loan to be approved by the ADB for conflict-affected area rehabilitation after the Tokyo donor conference in June 2003 and comes despite claims that the current political crisis stemming from difference between President Chandrika Kumaratunga and Prime Minister Ranil Wickremasinghe has affected foreign aid.

The agreement for the loan for the Conflict Affected Areas Rehabilitation Project is to be signed on Wednesday. The ADB will fund $80 million of the $107 million total cost with the government funding the balance.

The money will be spent to repair 500 km of roads, power distribution networks, schools, health centres, and irrigation and water supply systems.

It includes preparation of a project to provide the Jaffna peninsula with a reliable water supply. An ADB statement said project preparation involved consultation with stakeholders including government officials, communities, beneficiaries, donors and the LTTE.

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