Prospects for resuming donor aid

There is fear of economic collapse if donor aid to Burundi does not resume, according to experts. "There is no economy to talk about, the foreign reserves are at a minimum which has led to the emergence of a huge black market," Burundian economist Prime Nyamoya told IRIN on Tuesday. "If it was not for the strong subsistence economy, the situation would have got out of hand." He said the "short term cure" was for traditional donors
such as the World Bank and the European Union to resume economic
cooperation. Foreign aid to Burundi was suspended in 1996 when Major Pierre Buyoya was brought to power in a military coup. The suspension of aid followed a regional economic embargo that lasted 30 months.

In April this year a meeting of the World Bank board of directors is expected to consider an interim programme of economic aid to Burundi worth US $20 million to US $35 million over the next two years, according to the 'Economist Intelligence Unit'. In a report, it said the main reason for
the interim resumption of aid was to prevent a further worsening of the standard of living and to stabilise the economy during the peace process. Donors are pegging the resumption of full economic aid to the success of the Arusha talks.