   |
|
afrol News, 20 June - Mauritania has reached its completion point under the enhanced framework of the Heavily Indebted Poor Countries (HIPC) Initiative, meaning that the country's debt service relief from all creditors will amount to approximately US$ 1.1 billion over time. According to a statement made today by the International Monetary Fund (IMF), the net present value of Mauritania's total external debt thereby is reduced by some 50 percent. The Fund says this should provide "a good basis for long-term debt sustainability." Debt service payments are cut substantially-from about US$ 88 million in 1998 (actually paid before HIPC assistance) to an average of US$ 35 million in 2003, and averaging approximately US$ 39 million per year over 2002-2011, with HIPC and additional sources of debt relief included. As a result, debt service as a percentage of government revenue is reduced from 35 percent in 1998 to an annual average of 11 percent during the same period, IMF reports. - Resources made available by debt relief provided under the HIPC Initiative are being allocated to fund key anti-poverty programs, IMF says. Mauritania had set very ambitious targets for its poverty reduction policies. Mauritania had set an ambitious target of reducing poverty to 40 percent of the population by completion point. This would represent a reduction from 50 percent in 1996 and 56 percent in 1990. Although good progress was made in reducing poverty to 46 percent in 2000 according to the most recent household survey data, the ambitious 10 percentage point reduction hoped for has not been realized. This target, as well as other social targets, are now seen to have been unrealistically ambitious. In this context, the government has revised these targets for 2004. The World Bank's IDA is to provide debt relief amounting to US$ 100 million, to be delivered through a 65 percent reduction in debt service on IDA credits. The IMF will provide debt relief of some US$ 47 million, which will be delivered through a 55 percent reduction in debt service. Multilateral creditors are to provide debt relief amounting to US$ 361. To be included in the HIPC programme, Mauritania had to agree to "structural reforms and institutional strengthening", on which the country had "made substantial progress in carrying out." This has included privatisation, tax reforms and cutting public expenditure. Mauritania has however established a very strong record of economic performance over the past several years. GDP growth increased to 4.8 percent in 2000/01 (up from 4.2 percent average over 1995-1999) despite the adverse impact of global economic conditions in the second half of 2001.
|
Related items
