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Wednesday, 20 March, 2002, 18:13 GMT
Sierra Leone promised $950m debt relief
President Ahmed Tejan Kabbah (right) and rebel United Revolutionary Front leader Foday Sankoh sign peace deal
Since the peace deal the IMF has returned to Sierra Leone
Sierra Leone has been promised $950m (670m) in debt relief by the World Bank and International Monetary Fund (IMF).

The cash-strapped country has to abide by financial and economic programs prescribed by the two institutions to qualify for relief on what represents 80% of its debts.

Sierra Leone's finance minister Peter Kuyembeh
Kuyembeh: 'We have to make Sierra Leone habitable again'
"It is not secured only promised," Sierra Leone's finance minister Peter Kuyembeh told the BBC's World Business Report.

The relief stems from the heavily indebted poor countries initiative (HIPC) run by the Bank and Fund.

"Under HIPC your activities are very carefully watched. You have to conform to budgetary controls and prudent financial husbandry," said Mr Kuyembeh.

The World Bank said in a statement that Sierra Leone had "developed a detailed plan for the use of funds made available through ... HIPC, and for their transparent and accountable expenditure".

Sierra Leone was gripped for most of the 1990s by a civil war launched by the Revolutionary United Front (RUF), in which tens of thousands of people were maimed and more than two million displaced and exiled.

President Ahmad Tejan Kabbah declared the 11-year conflict over in January.

Rebuilding effort

The IMF and World Bank were persuaded to support the debt relief following what they saw as "strong" reforms in the government's policy on tax, trade, spending and management of the country's currency.

The government faces a huge task of rebuilding the country's basic infrastructure, and its financial plan includes more spending on education, health and the development of rural areas.

"We have to help people reconstruct their homes, their schools, their hospitals and make Sierra Leone habitable again," Mr Kuyembeh said.

In January the IMF released $12m in low-interest loans and said Sierra Leone had made "remarkable progress".

The economy has already shown signs of improving with a growth rate of 5.4% in 2001 and 3.8% the year before, after a 8% contraction in 1999.

The HIPC programme was launched by the IMF and the World Bank in 1996 and was their first effort to eliminate unsustainable debt in the world's poorest, most heavily indebted countries.

 WATCH/LISTEN
 ON THIS STORY
Peter Kuyembeh, finance minister, Sierra Leone
"We have to help people reconstruct their homes, their schools, their hospitals and make Sierra Leone habitable again."
The BBC's Alison Gee
"As peace has returned, economic growth has picked up."
See also:

13 Mar 02 | Africa
IMF unblocks aid for Sierra Leone
09 Feb 02 | Africa
Britain's future in Sierra Leone
28 Apr 01 | Business
Africa pushes for more IMF reforms
25 Feb 02 | Country profiles
Country profile: Sierra Leone
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