Burkina Faso gets €14m from crisis fund

Burkina Faso gets €14m from crisis fund

Friday, 10 September, 2010

Burkina Faso is one state among 19 set to benefit from the V-FLEX fund allocations, recently approved by the Commission (2 Sep). Overall, €264m is being divided up to help the most vulnerable African, Caribbean and Pacific countries cope with the global financial crisis.

Still facing extreme difficulty as a direct result of the global crisis, these countries require rapid action to avoid serious setbacks in those areas where funding gaps arise. The V-FLEX fund “will help 19 ACP countries maintain their level of public spending in priority areas, and therefore mitigate the social impact of the economic downturn” explained development commissioner Andris Piebalgs.

The fund acts pre-emptively to shoulder the impact of the downturn rather than intervening only after damage is done. Over two years (2009-2010) €500m is being made available for swift and targeted action.

On request, support will be given this year to 19 ACP countries: Antigua & Barbuda, Benin, Burundi, Burkina Faso, Cape Verde, Central African Republic, Grenada, Guinea Bissau, Haiti, Lesotho, Liberia, Malawi, Democratic Republic of Congo, Samoa, Sierra Leone, Togo, Tonga, Tuvalu and Zimbabwe. So far, Burkina Faso has been allocated €14m and Grenada €3.5m. Decisions regarding the other countries will follow in the course of the autumn.

Until now, €236m has gone out to 15 countries: Benin, Burundi, the Central African Republic, the Comoros, Dominica, Ghana, Grenada, Guinea Bissau, Haiti, Malawi, Mauritius, the Seychelles, Sierra Leone, Solomon Island and Zambia.

Based on forecasts of fiscal losses and other so-called ‘vulnerability’ criteria, allocations are made. These allocations are complementary to the loan-based assistance of the World Bank, the International Monetary Fund and regional development banks. They come in addition to €1bn food aid agreed on in March 2009 and €200m from the European Development Fund to help developing countries cope with higher food prices.