Co-financers have to follow suit: ADB on Padma project
Jica says it’ll consider position in consultation with Japanese government
Dhaka, July 2 (UNB) – After cancellation of the loan agreement by the World Bank, the Asian Development Bank (ADB), a co-financer of Padma Bridge project, on Monday said the co-financers of the bridge project cannot provide funds as the lead financer – the World Bank – has scrapped the deal.
Quoting the project document and agreement, an official at the lending agency’s resident mission said if a co-financier pulls out from the project, the agreement with the other co-financiers becomes ineffective.
“Due to the legal and joint nature of the co-financing arrangement, there’s no scope for the co-financers of the Padma project to provide fund for it,” the official said.
Meanwhile, Japan International Cooperation Agency (Jica), another co-financier of the Padma Bridge project today said their position has not been changed. “We hope that the government of Bangladesh will deal with the current issues in a constructive way.”
The Jica statement said the situation is very much regrettable in spite of the efforts between the government of Bangladesh and the World Bank. “We’ll consider our position to the Project in consultation with the Japanese Government, referring to the other co-financers positions.”
The ADB said it has been informed by the World Bank of its decision to withdraw its financing from the Padma Bridge project. “Padma is a landmark project for Bangladesh and the region,” according to an ADB statement sent to UNB.
It said the World Bank is the lead financier and arranger, working alongside the Asian Development Bank, Japan International Cooperation Agency (Jica) and Islamic Development Bank (IDB).
“ADB understands and respects the reasons that have led the World Bank to its decision. ADB and the World Bank follow similar policies, rules and procedures on governance and fiduciary oversight,” the ADB statement said.
However, given the importance of the project to the country and the region, ADB also deeply regrets that both parties were unable to reach a workable agreement to move the operation forward, it said.
The statement further says: “ADB has a longstanding relationship with the Government of Bangladesh and its people, and reiterates its commitment to their long-term development needs.”
The Asian Development Bank was supposed to provide US$615 million, Japan International Cooperation Agency US$400 million and Islamic Development Bank US$140 million more for construction of the multipurpose bridge.
On June 30, the World Bank formally canceled its US$1.2 billion IDA credit in support of the Padma Multipurpose Bridge project, the country’s largest-ever bridge, citing corruption concerns.
In April last year, the government signed a deal with the WB for a US$1.2 billion loan to construct the country’s longest US$ 2.9 billion bridge.
Jica was committed to funding $400 million for the Padma bridge project
The statements from ADB and Jica came two days after the leading financer of the project World Bank cancelled its $1.2 billion credit for the project claiming to have proof of a corruption conspiracy involving Bangladeshi officials, executives of a Canadian firm and private individuals.
Quoting the project document and agreement, an official at the lending agency’s resident mission said if a co-financier pulls out from the project, the agreement with the other co-financiers becomes ineffective.
“Due to the legal and joint nature of the co-financing arrangement, there’s no scope for the co-financers of the Padma project to provide fund for it,” the official said.
Meanwhile, Japan International Cooperation Agency (Jica), another co-financier of the Padma Bridge project today said their position has not been changed. “We hope that the government of Bangladesh will deal with the current issues in a constructive way.”
The Jica statement said the situation is very much regrettable in spite of the efforts between the government of Bangladesh and the World Bank. “We’ll consider our position to the Project in consultation with the Japanese Government, referring to the other co-financers positions.”
The ADB said it has been informed by the World Bank of its decision to withdraw its financing from the Padma Bridge project. “Padma is a landmark project for Bangladesh and the region,” according to an ADB statement sent to UNB.
It said the World Bank is the lead financier and arranger, working alongside the Asian Development Bank, Japan International Cooperation Agency (Jica) and Islamic Development Bank (IDB).
“ADB understands and respects the reasons that have led the World Bank to its decision. ADB and the World Bank follow similar policies, rules and procedures on governance and fiduciary oversight,” the ADB statement said.
However, given the importance of the project to the country and the region, ADB also deeply regrets that both parties were unable to reach a workable agreement to move the operation forward, it said.
The statement further says: “ADB has a longstanding relationship with the Government of Bangladesh and its people, and reiterates its commitment to their long-term development needs.”
The Asian Development Bank was supposed to provide US$615 million, Japan International Cooperation Agency US$400 million and Islamic Development Bank US$140 million more for construction of the multipurpose bridge.
On June 30, the World Bank formally canceled its US$1.2 billion IDA credit in support of the Padma Multipurpose Bridge project, the country’s largest-ever bridge, citing corruption concerns.
In April last year, the government signed a deal with the WB for a US$1.2 billion loan to construct the country’s longest US$ 2.9 billion bridge.
Jica was committed to funding $400 million for the Padma bridge project
The statements from ADB and Jica came two days after the leading financer of the project World Bank cancelled its $1.2 billion credit for the project claiming to have proof of a corruption conspiracy involving Bangladeshi officials, executives of a Canadian firm and private individuals.
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