New York (PTI): The World Bank has approved USD 12.5 million loan to assist Maldives to effectively manage environmental risks to fragile coral reefs and other marine habitats.

The Environment Management Project has been designed to help the government control the threats to coral reefs and marine habitats resulting from development, increased solid waste disposal and global climate change.

The project aims to advance the government's national development agenda by enhancing the environmental sustainability of growth in Maldives and improving the management of its key environmental assets.

"The Maldives faces daunting environmental risks that threaten to undermine its economic achievements," said Richard Damania, Senior Environmental Economist and task leader for the project.

"The country's coral reefs which protect it from storm surges and serve as the main asset of the tourism-driven economy are in danger of being damaged or destroyed from poorly handled waste disposal methods. The project aims to counter these risks by improving solid waste management and building capacity to strengthen incentives for better environmental administration," Damania.

The project will address the solid waste management problem by establishing solid waste management facilities on targeted islands, thus reducing the risks of contamination associated with accumulated wastes and sea dumping, which is a common practice.

The USD 12.5 million credit from the International Development Association, the World Bank's concessionary lending arm, has 40 years to maturity with a 10-year grace period.