8 February 2007
Accompanied with new anti-corruption frameworks and laws, loans to both Cambodia and Vietnam have been reinstated after a year of supension.
In June 2006, $11.9 million in World Bank funds for seven Cambodian projects were suspended due to corruption charges. The Bank unfroze $7.6 million of that funding for three development projects on February 7, 2007. The reinstated loans are for projects in land management and administration, infrastructure, and water supply and sanitation.
The Associated Press cites that the suspension was lifted after the Cambodian government reached an agreement with the World Bank on improved project implementation.
Vietnam has been haunted for the past year with accusations of fraud as tens of millions of dollars were allegedly misspent in a Transportation Ministry contract. VOA News reports that a Bank investigation discovered no misuse of the funds. Bank funding will recommence at a rate of $800 million per year for the next five years.
Wolfowitz's Anti-Corruption Crusade
In early 2006 World Bank President Wolfowitz began suspending funding to Bank projects due to alleged corruption. Many criticized his seemingly ad hoc method, which resulted in suspensions of at least partial funding for projects in at least eight developing nations.
Wolfowitz's actions inspired the institution's Development Committee to request the development of an anti-corruption strategy. Bank Management will present an updated draft of the strategy to the Development Committee at the April 2007 Spring Meetings.
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- World Bank Lifts Suspension Of Funding For Projects In Cambodia, World Bank Press Release, February 7, 2007 (World Bank website).
- World Bank Satisfied With Vietnamese Anti-Corruption Efforts, Matt Steinglass, News VOA, February 6, 2007 (News VOA).
- World Bank suspends loans to Cambodia over allegations of corruption, Bank Information Center, June 9, 2006 (BIC website).
- World Bank cuts more funding to Cambodia, Bank Information Center, July 1, 2006 (BIC website).
- Update on Consultations on World Bank Group Work in Governance and Anticorruption, February 1, 2007 (World Bank website).
- World Bank Governance and Anti-Corruption Strategy webpage (BIC website)