The loan was approved by the Board of Executive Directors and is the first of three envisaged in the 2005-8 period to help Croatia achieve its development goals.
The PAL is expected to help in the devising of development strategies intended to improve the agriculture, the infrastructure, the power sector, public administration and the judiciary, all of which is expected to facilitate Croatia's accession to the European Union.
"Successful integration with the European Union calls for intensive structural and institutional reforms, and the PAL supports the Croatian Government in that effort. It is an ambitious and challenging agenda, but implementation is vital if Croatia is to improve the public sector's capacity, and provide an enabling environment for the private sector," said Anand Seth, World Bank Country Director for Croatia, Romania and Bulgaria.
He added that thanks to the economic and institutional progress in recent months, the World Bank was confident that Croatia was on the right track.
Apart from the PAL, the World Bank today granted Croatia a EUR67.8 million loan for an Education Sector Development Project, the bank said in a press release.
Since 1993, the World Bank has assisted Croatia in 27 projects totalling USD1.55 billion and approved grants for over USD20 million.