afrol News, 23 January - During the last five years, Burundi has experienced negative economic growth in three of them. Also last year, GDP had shrunk by 1 percent. A fresh US$ 104 million programme however is to blow new life into Burundi's economy, if peace is lasting.

The International Monetary Fund (IMF) today published the results of its last review of economic developments in the country. During these last years of warfare, real GDP declined most of the time. Growth was at -1.0 percent in 1999, -0.9 percent in 2000, +2.1 percent in 2001, +4.5 percent in 2002 and finally at -1.0 percent last year.

With peace within reach, IMF Deputy Managing Director Agustín Carstens however is optimistic. "Burundi has made considerable progress in advancing the peace process since the signing of the Arusha Peace and Reconciliation Agreement in August 2000," he commented.

The authorities' implementation of the post-conflict program during 2002-03 had "contributed to improved economic conditions," said Mr Carstens. "Moreover, the recent issuance of Burundi's Interim Poverty Reduction Strategy Paper (I-PRSP) represents a major step forward in the development of the government's economic strategy for the coming years," he added.

- Looking ahead, Burundi faces the task of strengthening the peace process, resuming economic growth and reducing a heavy debt burden, reducing widespread poverty, resettling a vast number of refugees and internally displaced persons, and demobilising combatants, the IMF director said.

He found that Burundian authorities were "determined to address these challenges as part of a comprehensive economic and financial program supported by a three-year arrangement under the Poverty Reduction and Growth Facility."

Burundi's 2004 budget increases spending on the social sectors. According to Mr Carstens, however, "a further reallocation of spending to productive areas of the budget and careful management of expenditures are necessary."

Burundian authorities with external assistance now aim to undertake measures to improve the performance of the coffee sector and diversify the sources of economic growth, while ensuring that displaced workers are protected. The IMF noted also that continued improvement in security was essential to facilitate the implementation of other important reforms, including privatisation.

- The positive outcome of the donors' forum convened in Belgium in January 2004 has further improved the prospects for implementing various programmes, including reconstruction, assistance to refugees and internally displaced persons, and institution building, said Mr Carstens.

The IMF director announced that the Fund also was to assist Burundian authorities in its economic reform programme through January 2007. The IMF board today had approved about US$ 104 million in conditional loans to be disbursed over three years, aiming at reducing poverty by enhancing economic growth.

By staff writer

© afrol News

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