Press Release: IMF to Extend 100 Percent Debt Relief to Tanzania Under the Multilateral Debt Relief Initiative

December 23, 2005

Mrs. Lelde Schmitz, the IMF Senior Resident Representative in Tanzania, issued the following statement on December 22 in Dar es Salaam:

"Under the Multilateral Debt Relief Initiative, the IMF Executive Board has approved debt relief for Tanzania (see Press Release No 05/286). Under the Initiative, the IMF will provide 100 percent debt relief on all outstanding debt incurred by Tanzania to the IMF before January 1, 2005 that remains outstanding. This amounts to approximately US$336 million, or US$297 million excluding remaining assistance under the Heavily Indebted Poor Countries Initiative. This debt relief should become available in early January as soon as the remaining consents of the contributors to the PRGF Trust Subsidy Account have been received. The international community has made these additional resources available to help Tanzania make progress toward its Millennium Development Goals (MDGs).

"Tanzania has qualified for IMF debt relief because of its overall satisfactory recent macroeconomic performance, progress in poverty reduction, and improvements in public expenditure management. In particular, Tanzania has enjoyed robust economic expansion with low rates of inflation for more than five years, the government has established a sound record of implementing its Poverty Reduction Strategy Plans (including its National Strategy for Growth and Reduction of Poverty, known as MKUKUTA in Swahili), and it has improved its public expenditure management systems. Performance in these areas provides assurance that resources made available under the Multilateral Debt Relief Initiative will be used effectively."

"The IMF looks forward to working with Tanzania to help it develop a strong and stable economy and to make sustained progress toward the MDGs," she said.


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