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Last Updated: Monday, 10 May, 2004, 09:42 GMT 10:42 UK
Donors suspend work in Nepal
Maoist rally in Nepal
Supporters of the Maoists in the capital, Kathmandu
Three major western donor organisations have indefinitely suspended projects in western Nepal due to what they say are threats by Maoist rebels.

Their announcement will affect more than 50,000 people in some of the poorest areas of the country.

The agencies from the UK, Holland and Germany said that their staff have been subjected to persistent intimidation and extortion.

Last week they accused Maoists and the government of human rights violations.

'Threats and bombs'

The British Department for International Development and equivalent organisations from Germany and Holland made the announcement in a statement published on the front pages of Monday's newspapers in Nepal.

The United Nations World Food Programme also said it was pulling out, as did embassies from other European countries, Canada and Japan.

The agencies said that staff had been threatened, and bombs placed in the offices of a number of non-governmental organisations (NGOs) who they worked with.

The decision means the suspension in four north-western districts of a project that enables destitute people to get food in return for work on infrastructure projects.

For the sake of future development, we call on the Maoists to withdraw their demands and stop threats against all development organizations in Nepal
Statement by donor agencies in Nepalese press

The agencies say that 50,000 people will be affected and that they deeply regret the suffering that will be caused.

The newspaper statement called on the Maoists to stop physically harming their staff and support staff, and pledged to re-start their operations once security concerns are removed.

In the past, the rebels warned that only American-aided projects would be attacked because of their financial and military assistance to the government in tackling the insurgency.

Last week, a meeting of Nepal's international donors ended without reaching an agreement on aid.

The government says that it needs a commitment from donors to provide annual aid worth $560m.

But representatives of 30 donor agencies said assistance would depend on restoring democracy and resolving the long-running Maoist insurgency.

Foreign aid is crucial for Nepal, which depends on outside assistance for more than half of its budget.

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