IMF approves loan

The International Monetary Fund (IMF) on Monday approved a three-year loan of about US $78 million for Mozambique under the enhanced structural adjustment facility (ESAF), the IMF said in a press release. The loan is to support the government’s 1999-2002 economic reform programme and will be disbursed in three instalments. The first tranche of about US $11.2 million would be available on 8 July. “Despite the impressive macro-economic achievements of the last three years, poverty remains a compelling issue,” the IMF said in its release. “The national poverty assessment of 1998 found that about 70 percent of the population still lives below the poverty line,” added the release. The IMF said other areas of concern are relatively low government revenue collection as a percentage of GDP and the pressing needs for infrastructure and social services which have led to a heavy dependence on foreign aid. “Moreover, domestic savings is low, the legal and regulatory environment for private sector activity needs strengthening and public administration is handicapped by a lack of qualified staff,” the IMF said.