"The purpose of the Fund programme is not to provide resources for the reconstruction, because we're not the best institution for that," she said, noting that donor countries and institutions such as the World Bank were able to provide grant handouts, which would not add to Haiti's debts.

Delechat said the IMF programme did not restrict aid spending.

"All the spending that can be financed by donor money is allowed under the programme ... the idea is to facilitate the absorption of the aid," she said.

Recovery still fragile

The IMF said Haiti's recovery after the quake was still fragile and that the biggest contributor to economic growth would come from reconstruction efforts.


Sebastian Walker reports on the progress
in Haiti's quake reconstruction

It forecast that the economy would expand by around 9 per cent in fiscal year 2011-12, slowing to 6 per cent by 2015 as rebuilding tapers off.

Dominique Strauss-Kahn, the IMF managing director, urged donors to make good on their aid promises to Haiti, so that reconstruction can be accelerated and social tensions soothed.

Donors pledged $9.9bn to Haiti's reconstruction at a conference in March, of which $5.3bn is to be disbursed over the next 18 months.

Bill Clinton, the former US president who co-chairs the Haiti reconstruction commission, has complained that donor funding is flowing too slowly and holding up the rebuilding process.

Delechat said the IMF hoped that the approval of the programme would be a sign of confidence in the government's policies and encourage donors to pay up.

Cycle of debt

However, Al Jazeera's Sebastian Walker, reporting from Port-au-Prince, said the IMF decision is not likely to register on the priorities of those still living in displacement camps six months after the earthquake.

"That's not to downplay the size of this debt forgiveness. It certainly is a substantial sum," he said.

"But while they are forgiving that debt, they are issuing another $60m of loans.

"That loan will be interest-free until 2011, but by the end of next year, Haiti will then start repaying interest on new loans, which some might say is only perpetuating the cycle of debt that this country has struggled to get out from.

"So while it does seem like good news, there are other concerns that can be gleaned from reading between the lines."

Riding on deep frustrations over the slow pace of reconstruction, opponents of Haiti's president, Rene Preval, have called for a general strike on Thursday to press for a postponement of elections planned for November 28.

They hope to halt traffic and shut down businesses in the capital to press their demand that a new electoral council be formed before the election. Current councillors, they say, are corrupt.