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Cablegate: Consultative Group Pledges $5.7 Billion for Drc

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS KINSHASA 002167

SIPDIS

E.O. 12958: N/A
TAGS: EAID EFIN ECON CG
SUBJECT: CONSULTATIVE GROUP PLEDGES $5.7 BILLION FOR DRC

1. Summary. The Paris Club Consultative Group met in
Kinshasa November 11-12 to review the DRC's economic
transition and recovery program (Minimum Partnership Program
for Transition and Recovery - MPPTR), and to pledge support
for the country's development needs over the next 3-4 years.
Of a total of $6.9 billion requested by the GDRC, donors
pledged $5.7 billion. With an additional $1 billion already
invested in current projects, World Bank sources indicate
that almost all of the GDRC's MPPTR needs will be funded.
End summary.

2. The GDRC, after consultation with the World Bank and the
IMF, formally presented a $6.9 billion program for economic
development over the next 3-4 years. It asked donors in the
Consultative Group to fund 16 key areas: macroeconomic
management ($1.24 billion); transport ($919 million); health
($651 million); water ($621 million); education ($620
million); energy ($598 million); urban development ($409
million); Disarmament, Demobilization, Reintegration and
Security Sector Reform ($325 million); elections ($285
million); agriculture ($258 million); productive sectors
($255 million); HIV/AIDS ($250 million); governance ($181
million); social and humanitarian ($170 million); environment
($50 million); and scientific research ($37 million). The
government said it intends to supplement all international
assistance received with a 10% contribution of its own.

3. Opening the meeting on November 11, President Kabila
asked donors to "take into account the government's efforts"
on the macroeconomic front, highlighting achievements in
reducing inflation, increasing GDP growth, and stabilizing
the monetary exchange rate. The President made a plea for
donor pledges to be translated into rapid disbursements so
that the government can get on with its program of rebuilding
infrastructure and revamping the economy.

4. Kabila's positive message on the economy was reinforced
by a generally upbeat assessment from an IMF mission in
Kinshasa at the same time (septel). Donors responded
favorably, and the level of pledges was surprisingly high.
As Emmanuel Mbi, outgoing Director of Operations for Central
Africa at the World Bank, subsequently pointed out, it is
very unusual to see such a large-scale program to be fully
funded at a donor's meeting.

5. The GDRC was likewise satisfied with the outcome.
Minister of Plan Alexis Thambwe said the government was "very
pleasantly surprised by our partners" who had clearly
signaled they "believe in our country." The one sour note
came from Finance Minister Andre Philippe Futa who complained
that donors were only funneling 40% of their assistance
directly through the GDRC.

6. USAID/DRC Mission Director provided opening and pledging
statements. He highlighted USG commitment to support a
successful transition in the DRC and the achievements made by
the DRC over the past several years. He noted, however, that
positive achievements are tempered by continued political
instability and conflict. He reported the USG provided more
than $110 million to support development and humanitarian
assistance programs in the DRC in FY04. The USG plans to
continue its important development activities in the areas of
health, civil society building, human rights, gender
violence, conflict resolution, agriculture and livelihoods
promotion, basic education, environment and the reintegration
of ex-combatants. The USG will also continue to support
humanitarian efforts, particularly in eastern DRC.

7. Comment: The Consultative Group meeting has to be seen
as a success by the GDRC. While donors reiterated ongoing
concerns about important aspects of the GDRC's economic
performance and management, their pledges are a clear
indication of strong support for the Transition and for the
efforts made thus far to rebuild a war-ravaged economy. End
summary.
MEECE

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