From: barnhart@ddsw1.MCS.COM (Mr. Aaron Barnhart)
Subject: IPS:MOZAMBIQUE: IMF clears 42-million-dollar loan
Date: Sun, 13 Dec 1992 07:35:00 GMT
Organization: Evanston, Illinois, U.S.A.

Copyright Inter Press Service 1992, all rights reserved.  Permission to re-
print within 7 days of original date only with permission from 'newsdesk'.

Title: MOZAMBIQUE: IMF clears 42-million-dollar loan


washington, dec 3 (ips) -- the international monetary fund (imf)
thursday cleared the third installment of a three-year, 140-
million-dollar loan to help the government of mozambique implement
a far-reaching economic programme.

the latest installment -- for 42 million dollars -- will be
provided at a critical moment in the peace process of the war-torn
southern african nation which is also trying to recover from the
worst drought this century.

ending a 15-year civil war, the government of president joaquim
chissano signed a ceasefire agreement with the renamo rebel
movement in rome eight weeks ago.

the accord, which has been slow to take hold, has nonetheless
permitted relief agencies to get food and medicines to renamo-
controlled regions previously outside their reach.

hostilities have also been sharply reduced along the beira
corridor -- the critical rail, highway, and pipeline link between
the indian ocean and landlocked zimbabwe which is waiting for the
deployment of a u.n. peacekeeping force before withdrawing
thousands of its soldiers who guarded the corridor during the
latter years of the war.

mozambique launched a structural adjustment programme (sap)
designed to make its economy more market-oriented in 1987. backed
by imf loans, the country made ''considerable progress in
reversing economic decline and in improving key areas of economic
management,'' the fund said thursday.

but the country's economic performance over the last year was
hurt by the effects of the drought, as well as continuing
fighting, the fund said.

while the economy grew by 2.7 percent in 1991, it is currently
projected to contract by 1.4 percent this year, while food
shortages contributed to a rise in the inflation rate to an
estimated 50 percent.

nonetheless, the fund praised the government for continuing
financial and trade reforms.

the programme which the new installment is designed to support
aims to achieve a real economic growth rate of three percent next
year and a slowing of inflation to some 29 percent by the end of
the year. (more/ips)

mozambique: imf clears 42-million-dollar loan(2-e)

mozambique: imf clears (2)

structural measures to be undertaken stress privatising and
reforming public enterprises and restructuring the banking system,
according to the fund.

to cushion the effects of both the reforms and the drought felt
by the poorest population groups, the fund said the government's
programme aims to expand employment and other income-generating
opportunities, particularly in the agricultural sector.

it also seeks to strengthen a ''safety net'' for the poorest
households and increase the coverage and quality of basic social
services, according to the fund.

the loan is being extended under the fund's extended structural
adjustment facility (esaf), which charges a nominal interest rate
of only 0.5 percent. (end/ips/jl/yjc/92)
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