World Bank warns Myanmar on corruption as it unveils $2 billion in aid

YANGON Mon Jan 27, 2014 9:22am EST

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YANGON (Reuters) - The World Bank on Monday warned Myanmar against corruption as it unveiled a $2-billion aid package designed to provide better health care and improve supplies of electricity.

Despite the country's ongoing reforms, the World Bank has ranked Myanmar 182 out of the 189 countries in its annual Doing Business report.

World Bank president Jim Yong Kim told reporters in the Myanmar capital, Naypyitaw, that he recalled shutting down a program in Bangladesh on his first day on the job in 2012, because of corruption concerns.

"I would not hesitate to do that again if we were to find evidence of corruption in any of the projects," he said, adding that he was confident the Bank would be able to monitor programs in Myanmar to prevent abuse.

About 75 percent of Myanmar's mostly rural population has no access to health care, and more than 70 percent have no electricity, the Bank said.

Part of the aid package will support the government's aim of providing health care to all citizens by 2030, while half will go to expand electricity generation, transmission and distribution, the Bank said in a statement.

The news comes nearly two years after the World Bank announced it would return to Myanmar following an absence of a quarter of a century.

Many donors abandoned the country during its 49 years of military rule, which eviscerated one of Southeast Asia's most promising economies.

In February 2012, the Bank said it would re-engage with Myanmar after a March 2011 transfer of power from the military to a semi-civilian government that kicked off sweeping political and economic reforms.

In January 2013, Japan helped Myanmar's government clear debts left unpaid by the previous ruling junta, allowing the World Bank and the Asian Development Bank to provide financing.

Myanmar's low score on the Doing Business survey last October was due to corruption, Charles Schneider, a World Bank economist based in Yangon, said at the time, though he added the country was improving transparency.

(Additional reporting by Aye Win Myint in NAYPYITAW; Editing by Clarence Fernandez)

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