Reuters quoted a Guinean official said the government of Guinea will use 35% of a USD 700 million windfall from Anglo-Australian miner Rio Tinto to rebuild the mineral-rich West African nation broken infrastructure.

Rio struck a deal with Guinea in April to settle a dispute over its stake in the Simandou iron ore project agreeing among other terms to pay USD 700 million in compensation a sum that is nearly 75% of the poor nation's 2008 budget.

Guinea did not release budget figures for 2009 and 2010 when it was under the rule of a turbulent military junta. The USD 700 million is expected to boost Guinea USD 4.5 billion economy held back by years of political instability and lack of infrastructure despite its mineral wealth in bauxite, gold, iron ore and diamond coveted by major miners including Vale, Rusal and Chinalco.

Mr Amadou Camara member of a council that is acting as Guinea transitional parliament said about USD 240 million will be spent on improving roads, electricity, health, the justice system and education in this fiscal year.

He said Guinea budget minister presented the body with a revised budget including a spending plan for part of the money and the council had adopted the plan.

Mr Camara said "About 770 billion Guinean francs will be used in the power sector including the launch of the 240 megawatt capacity Kaleta Dam and the purchase of a thermal power station with a capacity of about 100 megawatt."

He said about USD 25 million will be used for military and security spending while about 1% of the amount released will be spent on education. He added that the remaining USD 460 million will be kept in the state treasury for future budget outlays.

(Sourced from Reuters)