Ramallah, July 21, 2009 (WAFA)- The World Bank will provide $40 million in budget support for Palestinian Authority’s (PA) Palestinian Reform and Development Plan (PRDP), a World Bank report issued, Tuesday stated.

 The grant was signed last week by PA Prime Minister, Salam Fayyad, and World Bank Acting Country Director for the West Bank and Gaza (WBG), Dina Abu-Ghaida. Earlier in the week the Bank granted the PA $21.5 million in additional financing for Gaza recovery and reconstruction and $12 for solid waste management in the southern West Bank.

The PRDP was presented by the PA to the December 2007 Paris Donor Conference. It includes a three-year (2008-2010) fiscal framework. This is the second World Bank budget support grant made on its basis. It is designed to help the PA strengthen its fiscal position.

The grant was authorized after the Bank assessed adequate progress on a number of public financial management reforms: (a) establishment of a cash management plan; (b) implementation of a computerized accounting system throughout all ministries; (c) production of annual audits of government agencies; and (d) development of annual budgets on a timely basis.  

“This grant signals the Bank’s positive assessment of PRDP implementation,” said Ms. Abu Ghaida. “However, it is important to remember that for the PA to meet its fiscal goals, reforms must be accompanied by substantial private sector growth. This can only be accomplished by further relaxation of the Israeli closure regime, enabling Palestinian enterprises to reliably access markets. In the immediate term, fiscal stability is dependent on the donor community.”