Further debt relief unlikely this year Stabroek News February 27, 2001 It seems unlikely that Guyana will secure the additional US$320 million net present value debt relief from its creditors this year as it had anticipated. Stabroek News understands that almost all of the donors programmes are at a standstill, given that elections are to be held in less than a month. No major policy directives are being issued in this period and as a result, it is not expected that all of the conditionalities for the additional debt relief would be met. Among the conditionalities facing the government is a broad-based, fully participatory poverty reduction strategy paper which would have to be completed by May. There is also need for stable macroeconomic conditions which will be evidenced by satisfactory performance under the government's second year programme with the International Monetary Fund (IMF). The conditionalities on governance include satisfactory progress in the reform of the public procurement system, including the tabling of new procurement legislation in parliament. The social sectors and structural reforms target include increasing the number of teachers and health care workers; developing a plan for the 2002 population census; achieving satisfactory progress in civil service reform; proceeding with the satisfactory implementation of an agreed, revised modernisation plan for GUYSUCO; bringing GNCB to the point of sale and open to bidding; having the investment law tabled in parliament and strengthening the framework for private investment and beginning the implementation of SIMAP III. However, it is expected that the poverty strategy paper, which is key, will not be achieved by May. This is because with elections on March 19, a new cabinet will be in place before the end of the month. It is expected that the first priority of the government will be delivering a budget in the national assembly before the end of April. This will leave little time for the broad-based consultation process required to have the interim poverty paper finalised by May. With businesses holding back on investments in this period and with the estimates that growth will be negative or either flat for 2000, what transpires after the elections will be crucial for the conditionality of stable macroeconomic conditions. New procurement legislation is also unlikely to be laid in parliament before the third quarter and civil service reform is targeted for this period. The implementation of an agreed, revised modernisation plan for GUYSUCO may be tricky given the initial position of the World Bank study that the plan, in its current design, was not financially feasible and ought to be scaled down. The bank is now working with new information provided to it by GUYSUCO's management and is expected to conductive an extensive social impact assessment on its recommendations before the final report is handed in. This report will not be handed in before elections. Bringing GNCB to the point of sale by mid year may also not be achieved because of the technicalities involved in this transaction. However, if the new government grapples with these issues after the elections in a fast and efficient manner, it could win the support of the World Bank/IMF for this further relief. Follow the goings-on in Guyana in Guyana Today If you do not see the 'Guyana: Land of Six Peoples' drop-down menu on the left then please click here to enter through the front door which will give you additional options and information.