§ Baroness AmosMy right honourable friend the Secretary of State for International Development (Mr Hilary Benn) has made the following Written Ministerial Statement.
Ghana successfully reached completion point under the heavily indebted poor countries initiative (HIPC) on 13 July 2004, becoming the 14th country to do so.
Under the arrangements agreed when Ghana applied for HIPC status, Ghana will have its debt reduced in net present value terms by 2.2 billion dollars. In addition, many bilateral creditors have indicated their intention to provide additional relief beyond the enhanced HIPC initiative (estimated to total about 500 million dollars in NPV terms). Between 2004 and 2013, Ghana could save approximately 230 million dollars annually in debt service costs.
Debt relief, together with bilateral assistance beyond HIPC relief, will lower Ghana's debt-to-export ratio to 84 per cent, and its debt-to-government revenue ratio to 130 per cent in 2004. It is estimated that Ghana's debt will remain sustainable (by HIPC definitions) for a wide range of scenarios covering the next 20 years.
Ghana applied for HIPC status in 2001 with the strong encouragement of the UK, and in particular of my right honourable friend the Member for Ladywood, then Secretary of State for International Development. Since then the Government of Ghana have begun to implement their poverty reduction strategy, maintained sound macroeconomic management, and undertaken some important structural reforms as agreed at decision point.
Completion point is good news for Ghana and an opportunity to move further and faster with its poverty reduction programmes.