African Development Bank moots lending to Egypt

Agencies, Monday 28 Mar 2011

Tunisia set to receive $1.2bn loan while bank holds talks with Egyptian authorities

The African Development Bank (AfDB) said on Monday it will lend Tunisia US$1.2 billion to aid the North African country's recovery from January's political turmoil and is considering a similar loan for Egypt.

Tunisia has been struggling to restore stability since the departure of President Ben Ali following weeks of unrest that triggered uprisings across North Africa and the Middle East.

"We are all set to commit to Tunisia close to $1.2 billion to help their country recover," AfDB President Donald Kaberuka told a meeting of African finance ministers in the Ethiopian capital Addis Ababa.

"We are in discussions with Egyptian authorities and we will be doing so for other countries in the region."

Kaberuka gave no more details.

Economic analysts are worried about the impact the upheaval in North Africa may have on several of the region's economies.

"We are revising our (growth) projections for North Africa because the economies are still reeling in the aftermath of the revolutions," Kaberuka said.

Kaberuka said the bank has committed nearly $7 billion in North Africa but that growth was uneven and government programs failed to reach the poor. He also blamed an imbalance in the labor market for the high unemployment and underemployment that provoked recent uprisings.

"The youth of North Africa has now spoken," he said. "The first responsibility of any developmental state is therefore to attempt to meet those aspirations -- and you can see they have a lot to do with economic welfare, economic opportunities -- but they go beyond bread and butter."



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