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HomeNewsArchivesWorld Bank approves US$140 million electricity loan for Burma

World Bank approves US$140 million electricity loan for Burma

The World Bank on Tuesday approved a US$140 million interest-free loan to boost electricity access in Burma, where over 70 percent of the population live in darkness.

The project, which will replace aging gas turbines in Mon state, is expected to produce 250 percent more electricity by developing a sustainable, modern and efficient power plant, according to the Bank.

“Delivering reliable energy services to those in need will be essential to end extreme poverty and build shared prosperity,” said Axel van Trotsenburg, the Bank’s East Asia Pacific Regional Vice President.

The World Bank has continued to step up its economic engagement with Burma’s quasi-civilian regime, which has introduced a series of reforms since taking power in 2011 and formally ending decades of military rule.

The new loan comes from the International Development Association, which is the Bank’s fund for the poorest countries in the world, and aims to bring “good practices” into Burma’s energy sector.

Power cuts are common throughout Burma, including its commercial capital Rangoon, where fury over electricity shortages unleashed a wave of protests last year. The current power plant in Mon state uses technology that is almost 40 years old.

In January, the Bank announced that it would clear Burma’s outstanding debt of some US$440 million, with the help of a bridge loan from Japan, allowing the country to reapply for grants and loans from international institutions.

The World Bank has vowed to push ahead with “people-centered” reforms in Burma, focusing on improving the lives of the rural poor, where only 16 percent have access to the electricity grid.


Burma is the poorest country in Southeast Asia, despite its vast reserves of natural wealth, including hydropower and natural gas reserves estimated at 10 trillion cubic feet. Most of its electricity is currently exported to its neighbouring countries, notably Thailand and China.

“Myanmar’s [Burma’s] transition has tremendous potential to reduce poverty. A more reliable electricity supply will create jobs and improve lives,” said Kanthan Shankar, the Bank’s country manager for Burma.

The Bank also emphasised the need for Burma to develop “long term” solutions, including diversifying its energy sources and introducing regulatory reforms in its natural resource sector.


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