In 1990, the Djibouti government significantly expanded its public investment program. Projects in communications, agriculture, and fisheries, as well as in social and environmental areas, were planned. Execution of these plans was put on hold as a result of subsequent domestic disturbances. The Persian Gulf War also disrupted investment programs sponsored by Iraq, Kuwait, and Saudi Arabia.
French budgetary support of the Djibouti economy is crucial to its stability, providing some 45% of foreign aid. The longstanding French financial commitment has weakened since 1989, and the International Monetary Fund (IMF) has expressed serious concern over key budget and trade deficits. In 1999, Djibouti negotiated a three-year $26 million Enhanced Structural Adjustment Facility (ESAF, subsequently Poverty Reduction and Growth Facility—PRGF) with the IMF.
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