[clari.biz.economy.world] World Bank approves first loans ever for Poland

clarinews@clarinet.com (CARLOS BREZINA, UPI Business Writer) (02/07/90)

	WASHINGTON (UPI) -- World Bank President Barber Conable Tuesday
announced the multilateral organization's first two loans to Poland
totaling $360 million and said lending to the country could reach $2.5
billion in the next three years.
	The bank's lending program will focus on supporting further policy
reforms in Poland, including measures aimed at promoting a greater
reliance on market forces and the private sector, Conable told a news
	``These are our first loans to Poland since it joined the bank'' in
July 1986, Conable said. ``Looking to the future, the bank is working
with Poland on a lending program which could reach $2.5 billion in new
commitments over a three-year period.''
	Poland was a bank member after World War II and withdrew from the
institution, as well as from the International Monetary Fund, in 1954.
	The World Bank also may approve a structural economic adjustment
loan for Poland by June or July for an amount still under consideration,
Conable said, adding that he plans to travel to Warsaw around Feb. 20 to
sign the loans that were approved.
	Conable called the record of the Solidarity-led government of Prime
Minister Tadeusz Mazowiecki ``impressive.'' The government ``has boldly
begun to deal with the severe distortions that hamper the economy and
has started to introduce the major systemic changes which Poland
needs,'' he said.
	Bank officials said that over the next 18 months the bank expects
to lend Poland around $1.4 billion in addition to the $360 million
approved Tuesday.
	The organization said a $260 million loan will support a project to
improve Poland's trade with hard currency countries in the West by
raising the volume, quality and value of industrial exports.
	The project consists of a $245 million line of credit to the
National Bank of Poland to finance export-oriented investments and $15
million in technical assistance to help financial institutions and other
agencies adjust to the country's new economic and political environment.
	The project focuses on chemical, electro-engineering and wood-based
industries as well as smaller investments in other industries.
	Another World Bank loan for $100 million will support a project to
assist Poland's efforts to rehabilitate, modernize and expand
agricultural-processing industries, easing constraints on sales to hard
currency markets.
	Conable warned that ``others will have to assist Poland, too.
Indeed, nothing short of a broad-based international effort is
warranted, given Poland's proven commitment to reform and courageous
actions to date.''
	The World Bank president said he expects further actions from
official creditors, who hold three-fourths of Poland's $39 billion debt,
to help ease the country's debt service burden.
	The major industrial countries are providing Poland with billions
of dollars in loans to help its transition from an inefficient centrally
planned, inflation-ridden economy to a free market system.
	The bank's sister institution, the International Monetary Fund,
Monday approved a $723 million loan to help Poland stabilize its
	The loan, to be disbursed over 13 months in support of Poland's
balance of payments, could be followed later this year by another
longer-term loan of up to $2 billion to help Poland in its economic