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World Bank Unveils Plan for

Short-Term Aid to Bosnia

But the Bank is Already Having
Trouble Finding the Money

(PARIS, MARCH 1—AP) The World Bank unveiled a short-term plan Friday for helping war-shattered Bosnia get back on its feet. But the bank is already having trouble finding the money to pay for it.

The plan will cost $160 million, of which $45 million is provided by the World Bank and $75 million has been given by donor nations and institutions. But the World Bank said it doesnít know where the $40 million difference will come from. And thatís just to cover costs for the next several weeks. It will take at least four years to rebuild Bosnia, a project estimated to cost $5.1 billion—$1.8 billion the first year alone, said Michel Noel, chief of the World Bankís Central Europe operations.

"For someone who has been through so much destruction, 5 billion dollars can appear a bit paltry, but it seems like an enormous amount for those providing the money," Noel told reporters.

The first $160 million will go toward rebuilding roads, bridges and utilities destroyed by four years of war. It also will be used to buy desperately needed seeds, fertilizer and pesticides to revive farming in the Balkan nation and break its heavy dependency on food aid. Businesses such as textile, clothing, leather, wood and paper industries will get quick loans to restart.

"Some of these industries are labor-intensive, and their rapid revival would help generate employment and assist in the reintegration of demobilized soldiers and others displaced by the war," the World Bank said in a statement. Hundreds of thousands of people have fled Bosnia, which had a pre-war population of 4 million. An estimated 250,000 were killed or are missing and about 1 million are unemployed. The World Bank estimates the war caused up to $30 billion in damage to Bosnia.

The plan will also help poor families during the phasing-out of the foreign food aid that 80 percent of Bosnians still depend on, Noel said. And it will provide support to nearly 38,000 children orphaned by the war. Foster parents will get small grants to help pay for the care of foster children. "We hope that within one or two years we will have reestablished normal social security systems, like pension funds and unemployment insurance, so these special social funds can be phased out," Noel said.

Besides the World Bank, donors include the European Union, the United States, Canada and the London-based European Bank for Reconstruction and Development.

In December, Western donor nations pledged $523 million for 1996 to rebuild Bosnia. Since thatís less than a third of the expected tab, foreign and finance ministers from donor countries will meet in Brussels April 12 to try and fill the gap, Christine Wallich, the World Bankís acting country director for Bosnia, said in Washington.

"Humanitarian aid has been generous. But humanitarian aid is appropriate for wartime. Now we have to start reconstruction. This is peace," she said. In Geneva, the United Nations appealed Friday for $823 million for a massive repatriation and recovery program for Bosnia to "replace the despair of war with the hope of a lasting peace."

The biggest chunk—$353 million—will go to the U.N. High Commissioner for Refugees, which hopes to return two million refugees and internally displaced to their homes. An estimated 40,000 people have returned on their own. Mass returns are expected to begin in earnest this spring.

Additional resources
World Bank Approves First Loans for Bosnia
World Bank Home Page

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