The World Bank approved on Friday the First Development Policy Loan (DPL) for the Philippines in the amount of 250 million dollars, said a statement released by the bank.

The bank said the loan will help the Philippines reduce public sector deficit and debt by "strengthening tax administration, improving budget execution and fiduciary performance, and strengthening the finances of the power sector."

"The approval of this first DPL is a clear recognition by the World Bank of the major reforms we have undertaken to improve our prospects for growth," said Philippine Finance Secretary Margarito Teves.

"With the deficit numbers on a decline, we have entered a virtuous cycle of lower borrowing, leading to a reduction in debt service and generating more resources for infrastructure and social services," he said.

The World Bank provides DPLs on the basis of good economic management and policy reforms. This DPL is the first such loan by the World Bank in eight years, according to the statement.

Source: Xinhua