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US Treasury Secretary rejects IMF claim that Uganda cannot absorb further aid. By Alan Beattie in Kampala Financial Times; May 29, 2002 Paul O'Neill, the US Treasury secretary, intervened yesterday in a dispute dividing the Ugandan government, rejecting an argument that the country could not absorb more overseas aid as "baloney". The Ugandan ministry of finance is at odds with other ministries over the issue, and the International Monetary Fund, the World Bank and the Jeffrey Sachs, the Harvard economics professor, have also become embroiled. Mr O'Neill's remarks were the latest in a series of interventions on aid issues during his tour of Africa with the rock star and development campaigner Bono. Mr O'Neill visited an Aids clinic yesterday where a health ministry official complained that the finance ministry was setting limits that prevented a large increase in spending. The health ministry wants to triple health spending from its current levels of around $120m (ý82m, €130m) a year and use anti-retroviral (ARV) drugs to treat Aids, paid for by new aid from abroad. At a meeting of ministries, the IMF, World Bank, and non-governmental organisations last week, the finance ministry argued that the large influx of aid could push up the currency or increase inflation, hurting economic growth elsewhere. Following a meeting with President Yoweri Museveni yesterday, Mr O'Neill said: "I can't tell you what a bogus theory that is." He said Mr Museveni had reassured him that there was "no effective limitation on valuable assistance into Uganda". IMF and World Bank officials in Kampala yesterday said the discussion was premature, though the government had to be aware of the macroeconomic implications of large influxes of money. |
