World Bank lends millions of dollars to Moz

from Independent On Line

Maputo - Mozambique's poverty alleviation programme this week received a boost after the approval of a further $60-million loan by the World Bank.

"The council of executive directors of the World Bank has approved a credit for the International Development Association (IDA) to the value of US60 million for the implementation of the fourth phase of Poverty Reduction Support Credit (PRSC-4) for Mozambique," the bank said in Maputo on Friday.

The fourth phase of the PRSC is the second in a series of operations approved by the World Bank and will assist the government of Mozambique, among others, to implement reforms that will result in the reduction of poverty indices, and for the country to achieve the United Nations' Millennium Development Goals (MDGs).

Michael Baxter, World Bank regional director for Angola, Malawi, Mozambique, Zambia and Zimbabwe, said the loan would enable the Mozambican government to maintain economic stability.

The loan, which would be repaid in a period of 40 years and has a 10-year grace period, would attract an interest of 0,75 percent per year, the World Bank said.

Antonio Nucifora, head of the World Bank's Poverty Reduction Support Credit, said: "The operation will help the government implement the poverty reduction programmes on a broader base, particularly in rural areas.

"This will also equally provide key reforms in the government through proper management of public finances."

In the 2007 the United Nations' Human Development report placed Mozambique on the bottom list of the United Nation's human development ranking.

The report noted that while Mozambique was considered to have developed economically, its population continued to live in poverty.

According to the UN more than half of Mozambique's 20 million people live on less than 1 US a day and their situation was worsened by a legacy of poverty which stretched back more than 20 years.

On the eve of its independence from Portugal in 1975, Mozambique was plunged into a 16-year civil war in which a rebel movement was pitted against the newly elected government.

During the civil war most of the country's infrastructure was destroyed while the country was littered with landmines, many of which have still to be removed.