Thailand Resident Mission

Commercial Financing for Local Government Units

Implementation of a technical assistance to examine commercial financing for local government units continued in the first half of 2007.

• strengthen the capacity of local government units (LGUs) in financial reporting and project planning and execution;
• assess existing LGU accounting and auditing practices and suggest improvements consistent with international best practices;
• develop and implement detailed rules on government borrowing from commercial lenders and issuance of bonds
• identify and structure two pilot transactions for bond issuance.

Early in 2007, the work plan has been reviewed and revised. It now has six major deliverables:

1. review of legal/regulatory framework;
2. improved accounting, financial management, and reporting related to debt by LGUs;
3. strengthened revenues for LGUs;
4. tool kit for LGUs on Improving Creditworthiness and Borrowing;
5. commercial bond market assessment;
6. government lending to LGUs.

The technical assistance program is scheduled to be completed by October 2007.