The payment of the arrears should pave the way for a US$50m IDB budget support loan, ratified by Haiti's legislature last month.
The multilaterals suspended a total of US$500m of loans to Haiti in the wake of the disputed legislative elections of 2000.
The disbursement of four frozen IDB loans amounting to some US$146m could begin after the payment of the arrears and the government's vaguely credible steps towards holding free and fair legislative elections later this year.
In May, Haiti struck a deal with the IMF to cut spending and implement currency stabilisation measures. Haiti is obliged to come up with a plan to cut deficit spending from 5.2% to 2.7%.
It also has to reduce inflation from 13% to 10%, and to control spending in public sector companies. The IMF will come up with between US$100 and US$150m if Haiti keeps to its side of the bargain over the course of the fiscal year.
The government resorted to desperation tactics earlier this year, after recording nil growth in 2002, when Aristide demanded that France repay billions of dollars that Haiti handed over after its independence in 1838. Haiti began to pay 90m gold francs in the nineteenth century, which, Aristide calculated, was worth about US$21.7bn at current world prices, equivalent to about six times Haiti's current GDP. France, unsurprisingly, dismissed the demand.
End of preview - This article contains approximately 282 words.
Subscribers: Log in now to read the full article
Not a Subscriber?
Choose from one of the following options
