15597: Schweissing: 'Paralysed' Haiti to get IMF funds (fwd)

[Bob Corbett <corbetre@webster.edu>]

From: Daniel Schweissing <dan_schweissing@hotmail.com>

http://www.thenassauguardian.com

'Paralysed' Haiti to get IMF funds



Bahamas reacts with

'cautious optimism'



By LINDSAY THOMPSON

Guardian Business Editor

lindsay@nasguard.com



The Bahamas Government on Tuesday reacted cautiously to news that an
agreement may have been reached between the International Monetary Fund
(IMF) and Haiti, which would permit a resumption of foreign aid to Haiti,
suspended nearly three years ago.

Minister of State for Finance, Senator James Smith said, "Any improvement in
Haiti's economic conditions should mean a reduction in the numbers of boat
people to The Bahamas."

He told The Guardian that, "International aid is at this time the only
source of funding for social services, education, health services, etc. in
Haiti because the economy there is virtually paralysed."

Added Minister of Foreign Affairs, Fred Mitchell, "The Bahamas has worked
very hard in various international fora to assist in solving the problems in
Haiti, which we expect will, in turn lessen the likelihood of illegal
migration to our country, so any positive move toward economic relief for
Haiti is a positive move for The Bahamas."

The agreement commits the Haitian Government to reducing deficit spending,
stabilising the exchange rate and reducing inflation. It will further permit
Haiti to begin a programme that helps it battle against poverty and increase
economic growth.

The agreement was concluded last Thursday after more than a week of intense
negotiations, the Associated Press reported.

The Washington-based IMF began talks with the Western Hemisphere's poorest
nation in March.

According to the terms of the agreement, Haiti and the IMF will sign the
terms of an IMF Staff Monitored Programme (SMP). The signing should take
place in about three weeks.

A macro-economic programme is required before the government is eligible to
receive a US$50 million Inter-American Development Bank budget support loan,
officials said.

Once the 12-month SMP agreement is finalised and Haiti pays its arrears to
the Inter-American Development Bank, Haiti will be in a position to receive
the first US$30 million installment of the loan, it was further reported

The international community has frozen some US$500 million in international
aid since President Jean-Bertrand Aristide's Lavalas Family party swept May
2000 legislative elections, which the opposition charges were flawed.

Talks between the governing and opposition parties to hold new elections
have broken down, and the opposition refuses to participate in the balloting
until Aristide resigns. The president has said he won't resign before his
terms ends in 2006.

In the past two years, Haiti's economic growth rate has dropped below zero,
and the Caribbean nation has fallen deeper into misery.

In September, the Organisation of American States urged international
financial institutions to normalise relations with Haiti.

Meanwhile, Minister of Foreign Affairs Mitchell said that The Bahamas is
looking forward to continuing its interface with the Haitian Government when
bilateral talks resume on migration issues on May 22nd and 23rd in
Port-au-Prince.

"We expect to be able to complete work on an agreement between the two sides
on migration issues," he said.

The IMF is an international organisation of 184 member-countries. It was
established in 1945 to: promote international monetary cooperation, exchange
stability, and orderly exchange arrangements; to foster economic growth and
high levels of employment; and to provide temporary financial assistance to
countries to help ease balance of payments adjustments.



POSTED WEDNESDAY MAY 14, 2003

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