The International Monetary Fund and World Bank on Wednesday approved 1,4 billion US dollar (8 milliarder DKR) in multilateral debt relief for Rwanda, an Africa country working to rebuild its economy a decade after being torn apart by a devastating genocide.
The IMF and World Bank said Rwanda qualified for the write-off under the Heavily Indebted Poor Countries (HIPC) initiative, designed to ease excessive debt burdens stifling growth in the developing world.
Creditors pledges also include extra debt relief allocated to Rwanda because of an unexpected rise in the central African countrys debt-to-exports ratio, a result of falling export prices, the institutions said.
– The budget savings from this debt relief are an important contribution to further improvements in social indicators and … to reduce poverty in the years ahead, Pedro Alba, the World Banks country director for Rwanda, said.
In a separate announcement on Wednesday, the IMF said it would disburse an 860.000 dollar loan tranche to Rwanda after completing a review of its recent economic performance.
Rwanda has now drawn about 4,3 million dollar of its 6 million poverty reduction and growth facility (PRGF), a low-cost IMF loan first approved in August 2002. The program was extended by six months, and is now due to end in February 2006.
In its statement, the IMF said Rwanda provided inaccurate information about arrears on its external payments because of “a misunderstanding between the authorities and one creditor as to the due date of an interest payment.”
The IMF said it decided to allow funds to be released in any case, “given that the deviation was minor, had been settled in the interim, and had not endangered achievement of the other objectives of the PRGF-supported program.”
Rwanda is trying to get back on an even keel 11 years after 800.000 people were slaughtered in an ethnic genocide.
– Rwanda has largely achieved macroeconomic stability and established a good track record of policy implementation in 2004, said Kristina Kostial, the IMFs mission chief for Rwanda, adding: – Looking forward, the key challenge for Rwandais to raise the economic growth rate while maintaining macroeconomic stability and debt sustainability.
Rwanda is the 18th country to qualify under the HIPC initiative, joining Benin, Bolivia, Burkina Faso, Ethiopia, Ghana, Guyana, Honduras, Madagascar, Mali, Mauritania, Mozambique, Nicaragua, Niger, Senegal, Tanzania, Uganda and Zambia.
Kilde: www.worldbank.org
