WB's aid resumption to Ethiopia sign of confidence: Wolfowitz

15 July, 2006

World Bank President Paul Wolfowitz has said the resumption of aid to Ethiopia by the bank is "a sign of improved confidence in the country since donors cut direct support over political turmoil last year."

During his seven-African nation tour, Wolfowitz said the World Bank's re-engagement in Ethiopia, under a new aid initiative, should be followed by the government's action to correct problems that sparked last year's deadly post-election violence.

According to the bank's statement issued on Friday in the Nigerian capital Abuja, the private sector representatives were more confident in Ethiopia's prospects since a crackdown on opposition supporters after May 2005 polls, and urged more help from the bank, the country's largest investor.

They also asked Wolfowitz to speed up the involvement of the World Bank's private sector arm, the International Finance Corporation (IFC), in Ethiopia. The IFC's presence there was hampered by foreign exchange controls and restrictive laws.

The statement said Wolfowitz had in addition to fiscal policy issues championed freedom of the press during his visit and the need for a peaceful political environment in Ethiopia.

The World Bank chief also called for regional co-operation to preserve and exploit the resources of Lake Victoria to help cure chronic power shortages in east Africa.

At a meeting in Arusha, north Tanzania, with representatives of the three-nation East African Community, comprising Kenya, Tanzania and Uganda, Wolfowitz said the bank was interested in assisting efforts to harness the lake's development potential.

"Management of Lake Victoria resources is something all the countries around the lake need to work on together," he said.

The challenge of power generation in East Africa could perhaps be mitigated by more regional co-operation.

The lake, which provides the livelihood for some 30 million people in the shoreline countries of Kenya, Tanzania and Uganda has suffered a dramatic fall in water levels since 2003.

Source: Xinhua