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| Deputy Managing Director and Acting Chair of the IMF executive, Mr Takatoshi Kato. | |
PORT-AU-PRINCE, Haiti, July 14, 2008 -The International Monetary Fund (IMF) has given Haiti an additional US$26.5 million in assistance to help it cope with the impact of rising food and fuel prices, following its third review of Haiti's economic performance under the Poverty Reduction and Growth Facility (PRGF) arrangement.
The completion of the review will enable the immediate disbursement of US$38.7 million.
"Despite numerous external shocks, including rising international commodity prices and inclement weather, as well as political difficulties, Haiti's performance under its PRGF-supported programme and progress in structural reform have been commendable," said the IMF's Deputy Managing Director and Acting Chair of the Executive Board, Takatoshi Kato.
"However, sharply rising inflation, largely attributable to increases in international food and fuel prices, has been a challenge and is creating additional hardship for Haiti's large vulnerable population."
He pointed out that the authorities have appropriately put into place immediate measures to stabilise food prices, and are stepping up targeted measures to, among other things, expand school feeding programmes, create jobs through public works programmes, and boost domestic agricultural production.
"Although risks have increased, the Haitian government has displayed its ability and commitment to maintaining macroeconomic stability in the face of adversity. It is important that the international community stay firmly engaged to help Haiti through the current difficult period, to both help safeguard the gains already achieved and set the course going forward to boost growth and employment prospects, and improve living standards," Mr Kato noted.
He however added that there is a need to prioritise and cautiously manage budget execution during the remainder of the fiscal year.
"A continued strong focus on modernising customs and tax administration to raise revenues and meeting donor conditionality to receive pledged budgetary support will also be important," the IMF official suggested.
Meanwhile, Mr Kato said, monetary policy will need to focus on containing the spill-over of imported prices on core inflation.
The PRGF is the IMF's concessional facility for low-income countries. PRGF-supported programmes are based on country-owned poverty reduction strategies adopted in a participatory process, involving civil society and development partners, and articulated in the country's Poverty Reduction Strategy Paper.
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