Mozambican NGO rejects Bank emergency lending

15 April 2000

The Mozambican Debt Group (MDG) has protested against the one-year moratorium on Mozambican debt service payments granted by the World Bank in response to the devastation caused by the worst floods experienced by the country, and against the Bank providing loans to support emergency efforts.

The MDG argues that a one-year moratorium is not sufficient especially when the Bank is making more loans to the government to help it deal with the emergency situation, which will increase Mozambique’s indebtedness.

The World Bank has released $2.5 million for rehabilitating roads (money from the existing roads programme) and is waiting to contribute another $15 million from the same source.

The MDG argues that given the enormity of the destruction caused by the floods and by cyclone Eline it is impossible that the country can reconstruct in a year, and has condemned the Bank’s “sickening lack of humanity for all those Mozambicans who for years have sacrificed to pay the debt service.”

The MDG has appealed to the World Bank to:

  • Cancel Mozambique’s foreign debt completely;
  • Give grants and not loans to help the emergency situation;
  • Not use funds released under HIPC to help in the emergency.