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World Bank loans target rural development

MELBOURNE, Australia (Radio Australia, June 14, 2011) – The Papua New Guinea government was signing an agreement with the International Finance Corporation and the World Bank today that will make it easier for small and medium sized businesses to get access to loans.

Those businesses are seen as risky in PNG.

As a result, only 25 per cent have access to the bank loans they need if they are to take full advantage of the resources boom.

The agreement will set up a risk-share facility which will see the International Finance Corporation guarantee up to 50 per cent of suitable loans taken out though Bank South Pacific.

It will make available up to $61 million in new finance.

The agreement will also result in new training opportunities for small entrepreneurs and help the PNG commerce department to improve its regulation and services for small business.

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