Canada requests delay in Congo debt relief
The World Bank on Tuesday postponed a decision on writing off the debt of the Democratic Republic of Congo at Canada's request, a board official told Reuters.world Updated: Jun 30, 2010 07:49 IST
The World Bank on Tuesday postponed a decision on writing off the debt of the Democratic Republic of Congo at Canada's request, a board official told Reuters.
A World Bank spokeswoman confirmed the delay, which comes on the eve of Congo's 50th independence jubilee.
Congolese President Joseph Kabila had wanted the debt canceled before the June 30 celebration to show the world his country was putting its painful past behind it following a brutal 1998-2003 war in which some five million people died.
"A short postponement of the board discussion was requested by one of the executive directors," the spokeswoman said.
The World Bank board official, speaking on condition of anonymity, said the postponement was related to Canada's unhappiness over a legal dispute between Canada-based First Quantum, a major investor in Congolese mining, and the Congolese government.
The company is seeking international arbitration after the government sealed up its $700 million Kolwezi copper tailings project following a review.
The World Bank board was set to approve an estimated $8 billion in debt relief for Congo at the meeting on Tuesday and it was unclear exactly when the issue would be discussed, although one Bank official said it could happen on Thursday.
The Bank's sister organization, the International Monetary Fund, was still scheduled to consider Congo's debt relief on Wednesday, according to the IMF website.
Approval by both the World Bank and IMF boards is needed to secure the debt relief.
A meeting of the Group of Eight industrialized nations, hosted by Canada last weekend, called on Congo to sign up to the global Extractive Industries Transparency Initiative, or EITI, to increase transparency in oil, gas and mining.
"We urge the DRC to do more to end the conflict and to extend urgently the rule of law," the G8 said in its final statement after the summit.
Congo's debt stands at $10.9 billion, a figure that could fall to $2.3 billion if all foreign donors sign on to cancel its debts. Its annual debt service burden would fall to about $194 million from $920 million, a major step for one of the world's most impoverished countries.