Question 4c
Answer

The World Bank provides loans, often direct to governments, on a commercial basis, for capital projects. Loans are generally for a long-term period, which may suit the Naswan government.

However, the terms of the loan may be onerous, not just the finance costs but the other conditions imposed on the scope of the projects.

Given the circumstances of the investment, Naswa may be able to obtain assistance from the International Development Association, which is part of the World Bank. This provides loans on more generous terms to the poorest countries.

However, it is designed for countries with very high credit risk which would struggle to obtain funding by other means, and Naswa may not be eligible.