THE U.S. TREASURY DEPARTMENT AND AFRICA
The United States Treasury Department is a key contributor to U.S. and international efforts to support accelerated growth and development in Africa through:
Development Assistance via the International Financial Institutions (IFIs). Treasury leads U.S. participation in the IMF, the World Bank, and the African Development Bank. Over the past five years, these institutions have committed a total of about $18 billion in development assistance, on highly concessional terms, to Sub-Saharan Africa. IFI assistance is increasing for those countries implementing strong reforms.
Debt Reduction. Under Treasury leadership, the U.S. has forgiven over $1 billion in concessional debt owed by 19 African countries. An additional $250 million has been reduced within the Paris Club since 1994, and Treasury expects to provide another $1.6 billion in debt reduction in FY 1999 under the Paris Club and the President's Partnership for Economic Growth and Opportunity.
Treasury was a strong force behind the creation in 1996 of the Heavily Indebted Poor Countries (HIPC) Initiative, which includes, for the first time, debt reduction by the international financial institutions. HIPC is designed to achieve sustainable development and growth and manageable debt burdens for countries with exceptionally heavy debt. Under HIPC, Uganda is expected to receive $700 million in debt relief from all creditors. Mozambique, Burkina Faso and Cote d'Ivoire also have been declared eligible for HIPC relief, and we expect that other African countries will be declared eligible this year.
Technical Assistance. One of the most direct ways Treasury supports economic reform is through technical assistance. In South Africa, a Treasury expert is helping the government to implement "fiscal federalism" by assisting with the creation of a mechanism for allocating resources between the central government and local governments.
Bilateral Tax Treaties. The Treasury Department negotiated the U.S. - S.A. Tax Treaty which went into effect on January 1, 1998. The Treaty furthers Treasury's goal of establishing tax treaties with important trading partners.
Post Conflict Recovery. In 1997, Treasury appointed a post-conflict economic recovery coordinator to work with countries emerging from conflict, assisting in their efforts to adopt sound economic policies as the basis for growth.