UN expert criticises IMF loan to Haiti

GENEVA, Feb 4 (AFP):A UN expert Thursday criticised the International Monetary Fund for giving Haiti a 114 million dollar loan, and called for the urgent cancellation of the island's debts.

Cephas Lumina, the United Nations' independent expert on foreign debt and human rights, said the IMF loan was "profoundly inappropriate" for a country whose economy has collapsed following the devastating January 12 earthquake.

Haiti needed "urgent, unconditional grant-aid", not loans, Lumina said, and must be careful to avoid a new build-up of unsustainable debt.

Lumina welcomed the announcement by the Paris Club -- an informal group of 19 creditor countries -- that it would cancel the 214 million dollar debt owed to them by Haiti, the poorest country in the western hemisphere.

But he said this decision on its own was not enough to ensure the country would be able to recover from the quake, which destroyed large parts of Port-au-Prince and killed more than 200,000 people.

Haiti currently owes around 890 million dollars, the bulk to multilateral creditors such as the Inter-American Development Bank, with 41 per cent of its debt, and the World Bank, with 27 per cent.