The international financial institution said the financing will be used to support Indonesia in addressing issues with the nation’s supply chain, such as long dwelling times at ports and lengthy trade clearance procedures.
The World Bank on Tuesday granted the Indonesian government a $400 million loan to enhance logistics and strengthen connectivity in the nation.
The Logistics Reform Development Policy Loan will be used to support Indonesia in addressing issues with the nation’s supply chain, such as long dwelling times at ports and lengthy trade clearance procedures, the World Bank said. In addition, the financing will be used to support Indonesia in becoming a more competitive manufacturing-based economy.
The three primary components of the loan are to enhance port performance, improve competition in logistics services and strengthen trade facilitation.
“Costly and unreliable logistics are one of the key constraints to Indonesia’s competitiveness,” World Bank Senior Economist Massimiliano Calì said.
“Improved logistics for better connectivity will have significant effects on the country’s competitiveness as well as on poverty,” World Bank Country Director for Indonesia Rodrigo Chaves said. “Better logistics can reduce the cost of essential goods and services, particularly in more remote and less developed parts of the country.”
World Bank provides low-interest loans, zero to low-interest credits, and grants to developing countries. Headquartered in Washington, D.C., the international financial institution has more than 10,000 employees in over 120 offices worldwide.
World Bank grants Indonesia $400m loan for logistics reform
