Press Release No. 05/120

Press Release: Statement by IMF Managing Director Rodrigo de Rato at the Conclusion of His Visit to Chad

May 20, 2005

Mr. Rodrigo de Rato, Managing Director of the International Monetary Fund (IMF), issued the following statement today in Chad:

"I am happy to have had the opportunity to visit N'Djaména yesterday and have the privilege of meeting President Idriss Déby. We had a fruitful exchange of views on the policy challenges and the opportunities arising from the increase in Chad's oil revenues. President Déby and I agreed that oil resources provide Chad with an unprecedented opportunity to reduce poverty, and make progress toward the Millennium Development Goals.

"To achieve these objectives, the Chadian authorities need to strengthen fiscal policy on a sustainable basis. This will require both strong efforts to manage oil revenues in a transparent and efficient manner, and to lay the foundation for a vibrant non-oil economy. More generally, the President and I concurred that it was important to maintain the momentum in policy and reform implementation, with the aim of improving growth prospects and making progress toward the completion point under the enhanced Initiative for Heavily Indebted Poor Countries.

"The President and I discussed the challenges of reforms in the cotton sector, which is important for the Chadian economy, and the main source of income for a large part of the population. I recommended the early completion of a comprehensive reform strategy that will address immediate financing issues for cotton production and ginning, as well as long-standing structural problems in the sector.

"The President emphasized that the conflict in Darfur had made large demands on the national budget, adding that this cost should be equitably shared with the international community. Both with President and at the Oure Cassoni refugee camp I visited this morning, I observed that armed conflicts have fractured the social fabric and hindered economic development in Africa. As was so vividly evident at the refugee camp today, efforts toward peace have to be unrelenting so as to end the human tragedy that has affected too many lives in the region."