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Last Updated: Tuesday, 29 July, 2003, 13:37 GMT 14:37 UK
DR Congo gets $10bn debt relief
Dr Congo refugees
Thousands are too scared to return to their homes in Bunia
The Democratic Republic of the Congo is in line for debt relief worth as much as $10bn (6.2bn) after the International Monetary Fund and World Bank gave their blessing to economic reforms.

"In recognition of the authorities' satisfactory progress in implementing sound macroeconomic and structural policies, the DRC's total external debt... is to be reduced by up to 80%," the two said in a statement.

The move forms part of the enhanced Heavily Indebted Poor Countries (HIPC) initiative, under which 26 countries have already had part of their debt cut.

Some of the money comes in sweeping cuts in debt service payments owed over the next 25 years, both to the Bank and Fund and to individual countries - although some amounts to forgiveness of past arrears.

An IMF review completed a week ago pointed to positive economic growth in 2002 and inflation dropping from 135% to 16% in just one year.


But despite the Bank's and Fund's blessing, the economy of the war-torn nation remains in tatters, and the appointment of a new government comprising both the former administration and rebel groups has not stopped widespread and vicious fighting.

The situation is particularly dire in the resource-rich north-eastern Ituri region, where a United Nations force trying to impose peace has just had its mandate extended by another year.

The regional capital, Bunia, is getting safer, but the peacekeepers' writ barely extends beyond the town limits and killing and looting continues unabated elsewhere.

The DRC's troubles - both in Ituri and elsewhere - have been exacerbated by the involvement of neighbouring states in the long civil war which has ravaged the country ever since the exile and death of former dictator Mobutu Sese Seko in 1997.

Forces both domestic and foreign have been fighting over minerals, timber and diamonds ever since, meaning that Kinshasa has little control over much of the vast country.

Indeed, the Kinshasa government missed several of its IMF-mandated targets under the recently completed review - but was granted waivers on the grounds that it only missed the targets narrowly.

The World Bank made clear that it recognises the economic turnaround is very fragile.

"Executive directors of the World Bank also warned of the high risks the country faces going forward," said Emmanuel Mbi, World Bank country director for the Congo.

"They urged determined action by the authorities and concerted support from the international community to ensure that economic recovery attains a stronger foothold and the economy begins to realize its enormous potential," he said,

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