ANGOLA: World Bank stops further lending

The World Bank said on Tuesday that it would stop further lending to Angola unless the war-torn nation implemented critical economic reforms. "In past years we have been patient with the peace process underway in Angola, but now we have come to a point where further lending cannot be justified," Barbara Kafka, the World Bank country director for Angola told IRIN. She cited the resumption last December of the war between government forces and the UNITA rebel movement four years after the breakdown of the UN-brokered Lusaka Protocol peace accords, rampant corruption, questionable development policy and an economy that no longer functions, save for the oil sector. There was also concern at the growing distortion between the official and unofficial exchange rates. She said the World Bank would continue to supervise existing projects that had been previously approved in Angola, but would not undertake new programmes. The bank's office in the capital, Luanda, would be reduced in size and its country representative would not be replaced when his term expires next month. Last week, the Angolan finance minister, Joaquim David, visited the Washington headquarters of the World Bank and the International Monetary Fund (IMF). He told the Angolan media that lending institutions had warned him that accounting transparency, especially in the oil and diamond sectors, was a key short-term priority. Economists told IRIN they estimated the country's external debt at some US $11 billion. Kafka said the World Bank would review the situation at its annual meeting later in the year: "We are not stopping our dialogue with Angola," she said.