MUNIC DEVT I

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The main purpose of the First Municipal Development Project is to contribute to more effective public sector management at the provincial and municipal levels through improved financing mechanisms for municipal investments. Specifically, the project provides subloans to the five benefitting provinces for financing 50 percent of total eligible costs for: (a) physical investments; and (b) technical assistance and training. In order to implement effectively the project's objectives, only creditworthy municipalities will be eligible to receive subloans for physical investments, and each annual investment plan of each eligible municipality must have at least 65 percent of total physical investments allocated to components for which 100 percent of total investment costs will be fully recovered from payments to the municipality by direct beneficiaries.