World Bank steps up assistance to Mozambique

News Release No: 2000/239/S
World Bank to Provide Multi-Sector Assistance Package - Mission to Visit Next Week

WASHINGTON, March 3, 2000 - The World Bank is stepping up assistance to the Government and people of Mozambique in the wake of the severe rains and floods which have hit the southern African nation in recent times. The heavy rains, which began three weeks ago, have flooded parts of the southern provinces of Maputo, Gaza, Inhambane and Sofala causing a humanitarian crisis of enormous proportions. The flooding has worsened on account of Cyclone Eline last week, and has taken on a regional dimension as its effects are being felt in Zimbabwe and other neighbouring states. Hundreds in Mozambique are already reported dead while hundreds of thousands have been rendered homeless.

In response to the crisis, the Bank will accelerate access to funds from onging programs. The World Bank has already approved US$2.5 million for emergency road reconstruction out of an existing roads and coastal shipping project, with an additional US$15 million to come from the same project. A multisectoral World Bank team is to travel to Mozambique next week to assess the extent of the damage and define Bank emergency activities. The team will join with its country office staff to prepare detailed sector plans of action.

On the basis of the assessment, the Bank team will also prepare an emergency support credit that will help limit the impact of the disaster on the people of Mozambique and help keep its economic program on track.

The Bank is also acting to accelerate the delivery of debt relief. It will propose to its Board, in the context of the enhanced HIPC, an acceleration of debt relief to Mozambique through various modalities to cover 100 percent of International Development Association (IDA) debt service due over the next 12 months. Under this proposal, Mozambique will not have to pay debt service to IDA during that time. Mozambique is already receiving a total of $3.7 billion in debt service relief under the Initiative's original framework, and is expected in the coming weeks to qualify for more than $500 million in additional debt service relief under the enhanced framework.

Contact Person:

Jim Coates (+ 258-1) 492 851
Richard Uku (+ 1 202) 473-3432
e-mail: Ruku@worldbank