IMF slow to respond to Sri Lankan loan request
Updated
Sri Lanka's trade minister is accusing the International Monetary Fund of politicizing financial assistance.
Sri Lanka this year asked for $US1.9 billion in loans from the IMF, after its economy was ravaged by the long-running civil war and natural disasters. Now, the Trade Minister says the loan has been put off due to political pressure from the United States and other Western nations, amid allegations of war crimes and mistreatment of Tamil civilians displaced by the conflict.
Presenter: Desmond Ang
Speakers: Dr. Saman Kelegama, Executive Director of Sri Lanka's Institute of Policy Studies; Kanae Doi, Director of Human Rights Watch Japan; Connie Lotze, Deputy Chief of Media Relations for the IMF.
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ANG: Sri Lanka's economy was hit by the Tsunami in 2004 and has stretched by the long-running civil war, which officially ended in May this year.
The government asked the IMF for 1-point-9 billion US dollars in assistance so they could focus on rebuilding and resettling efforts.
But the aid money hasn't yet been approved.
Sri Lanka's Minister for International Trade - G.L. Peiris - told reporters the IMF delay could be the result of political pressure from IMF's Western member nations.
Dr. Saman Kelegama, Executive Director of Sri Lanka's Institute of Policy Studies, agrees - saying the average waiting period for an IMF loan application used to be between three to five weeks.
KELEGAMA: You see, to our knowledge, the IMF makes decisions in regard to giving financial assistance on the basis of the economic record of the country. Whereas in the current situation, we see that some amount of politics also have come into the decision and this is quite clear in some of the statements that have been made by some high officials of the US government.
ANG: The IMF's biggest contributor is the United States, which has criticised Sri Lanka over alleged abuses during the last stages of the civil war.
Kanae Doi, Director of Human Rights Watch Japan, has been keeping a close watch over the conditions of government-managed camps that house civil war refugees.
DOI: The situation of the camp is horrible, there are 300,000 people which is a very very big camp. They are not allowed to leave the camp although many of them have got relatives in the area. Whole families including elderly and children are often detained in this camp although there is no security threat associated with them, but the government now sees they must be detained because they virtually see them as a possible ally to the LTTE, which is a human rights violation itself.
ANG: But Dr Kelegama, from Sri Lanka's Institute of Policy Studies, says that although concerns from the US government are valid, delaying the loans will not make things better.
KELEGAMA: This money is in fact will be used to restore the rights of large segments of the population in this country. This is the money that will give breathing space to the government to allocate more financial resources to the rehabilitation of the north and east. If not, a bulk of our revenue will be used for resettlement in the coming months and there will be less money to be allocated for north and east relocation. So if the people who are very concern about human rights are trying to stop this, i think this is defeating the purpose.
Deputy Chief of Media Relations for the IMF, Connie Lotze.
LOTZE: The discussions with the authorities on an IMF supported program are still continuing. It's still under negotiations and under discussion and in the end the executive board will have to make a decision.
