EU pegs further aid to IMF cooperation

The EU said it would onlu help the cash-strapped government of the Central African Republic (CAR) pay its workers if it reaches a cooperation agreement with the International Monetary Fund. "If the IMF approved a programme with the CAR, the European Commission would then envisage the increase of its budgetary support," Amadeu Altafaj, spokesman for the EU's commissioner for development and humanitarian aid, told IRIN on Wednesday from Brussels. He made the comment after a meeting on Monday in Brussels between the EU commissioner for development and humanitarian aid, Louis Michel, and CAR's newly-appointed prime minister, Elie Dote. The government of President François Bozize, which was inaugurated in June, paid its civil servants back wages for December 2004. However, it still owes them at least 40 months of unpaid wages, including six months from the transition period after Bozize ousted the previous president, Ange-Felix Patasse, in March 2003. The EU had suspended its macroeconomic and infrastructure aid following the coup; giving only humanitarian assistance during the two-year transition period, as well as support for the elections. Then, on 1 July, the EU announced it was resuming its €100-million (Approx US $122 million) aid programme to CAR for 2002-2007. This will be for road construction, refuse collection and sanitation but this will not include government budgetary support. A 2004 IMF report found empirical evidence that the country's political instability was linked to the government's inability to pay salaries of civil servants and military personnel. The IMF did grant $8.2 million in emergency post-conflict aid to CAR in July 2004, and an IMF mission is expected there in July.