Press Release, June 15, 2000
World Bank Approves $115.4 Million in Credits to Improve Health in Indonesia

Contact Person:
Contact: Kimberly Versak (202) 458-2559
kversak@worldbank.org
Mohamad Al-Arief (62-21)5299-4144
malarief@worldbank.org

Washington, June 15, 2000-The World Bank today approved two International Development Association (IDA) credits for Indonesia worth $115.4 million for the Provincial Health project I, which will bring about effective health sector decentralization in two provinces; and the Second Water & Sanitation for Low Income Communities project, which will improve poor communities' access to adequate and cost-effective water supply and sanitation services.

"Both of these projects have a strong anti-poverty focus, and are geared towards improving the lives of the poor by delivering essential basic services - health and clean water/sanitation - to poor communities in a decentralized environment," said Country Director for Indonesia Mark Baird. "These projects, funded by zero-interest IDA funds, are part of our efforts to soften the terms of our overall assistance to Indonesia and help reduce the Government's debt service. We expect to develop similar projects in other sectors and areas of Indonesia as part of our new Country Assistance Strategy."

Provincial Health

During this period of institutional change and economic recovery in Indonesia, the project, targeted at Lampung and Yogyakarta provinces, aims to protect health services which are essential for the poor and public at large while initiating key sector reforms and ensuring health sector financing. It aims to protect health services, which are essential for the poor and public at large, while initiating key sector reforms and ensuring health sector financing. A second objective is to help the Ministry of Health carry out its new role in a decentralized system - a role which encompasses analysis of key issues, advocacy of best practices and standards, and support for local initiative and innovation.

The project, which will set in place a district ceiling, grant and proposal review process, will be implemented in two phases, with phase 1 (FY2000-FY2001) emphasizing building capacity at the local level including institutional development and resource mobilization; and phase 2 (FY2002-FY2005) focusing on districts developing proposals within assigned ceilings for grants to support health improvement.

Second Water & Sanitation for Low Income Communities Project

With the goal of improving the health status of poor communities by reducing water, sanitation, and hygiene-related illnesses in under-served rural villages, the project will aim to improve the health behavior and health services of the communities related to water borne diseases; provide safe, adequate, cost effective, and easily accessible water supply and sanitation services; and develop sustainability and effectiveness through community participation.

The project, which builds on ten years of Bank financial and technical experience in integrated water, sanitation and health programs in Indonesia, will be implemented in about six provinces through consultation with the Ministry of Health (MOH). The project will support demand-based improvements to water supply, household and community sanitation and hygiene, with funds being channeled through block grants directly to village level with separate budgets for district-level technical support.

WSSLIC2 has three basic components:

1. Community and Local Institutions Capacity Building will work through service contracts with local firms, NGOs or academic institutions to assist communities to organize effectively and also to obtain the technical capacity to plan, manage and control water programs, sanitation and community health.
2. Improving Health Behavior and Services will improve hygiene, health behavior and community management of health services related to water borne diseases through service contracts, health education, and direct services to reduce water borne diseases.
3. Developing Water and Sanitation Infrastructure will provide communities with accessible, convenient, and clean water in adequate quantity and safe options for solid and liquid waste disposal, in response to demands expressed by them.

For more information on these projects, please see the World Bank's InfoShop/Public Information Center at:
http://www.worldbank.org/html/pic/PIC.html


For more information about the World Bank's work in Indonesia, visit:
http://www.worldbank.org/eap