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IMF allows govt to spend debt relief cash on famine
2006-02-25 07:59:14
By Guardian Reporter
International Monetary Fund (IMF) has given Tanzania the green-light to use funds accrued from debt cancellation to buy power generation equipment and food to offset hunger and power deficit.
The decision was reached during talks between President Jakaya Kikwete and an IMF visiting delegation led by Acting IMF Executive Director, African Zone, Robert Sharer, at State House in Dar es Salaam yesterday.
The institution cancelled Tanzanian debt amounting to $380 million last year.
Tanzania is among 18 highly indebted poor countries (HIPC) that the Group of Eight (G8) countries agreed last year to cancel their debts by 100 per cent.
The debts include those owed to the World Bank and the African Development Bank.
This was President Kikwete’s first meeting with IMF officials since he came to power last December.
He said the decision had come at the right time and assured the delegation that the money would be spent on alleviating the famine and power problems.
Kikwete also assured the delegation of continued co-operation in tackling economic, social and political challenges.
Sharer said he was satisfied with the way the fourth-phase government was implementing its policies.
He said IMF is ready to support in the implementation of the government’s priorities.
Sharer said the government’s determination to increase revenue collection, review its recurrent expenditure and implement policies that would spur economic development will be given backing by the Fund.
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