THIRD WORLD DEBTS (Hansard, 24 October 1978)

§ Baroness LLEWELYN-DAVIES of HASTOE

Figures published by the OECD show that the total debts of the developing countries at the end of 1976 were provisionally estimated to be 206.8 billion United States dollars. A summary of those debts by category of creditors is as follows:

Creditor	Debt outstanding (disbursed only)
1. DAC countries	127.1
(a) ODA debt	37.1
(b) Total export credits	53.5
(c) Other (private)	36.5
2. International financial markets	33.5
3. International organizations	23.6
4. Centrally planned economies	9.0
5. OPEC countries	8.3
5. Other LDCs	3.8
7. Other and adjustments	1.5
Total	206.8

The provisional figure of interest paid in 1976 is 10 billion dollars.

Seven donor countries, including the United Kingdom, have so far announced generalised action to cancel or reduce past aid debts. Details are provided below of the countries and amounts involved. These do not include debt relief operations undertaken to support individual developing countries facing particular problems.

Canada. Cancellation of 254 million dollars due over about 50 years from 24 "least developed" countries (LLDC).

Finland. Write-off 10 million dollars to "less developed" countries (LDC).

1313WA

Federal Republic of Germany. Cancellation of 246 million dollars owed by Mali and Upper Volta; further measures are to be taken in respect of individual "least developed" countries.

Netherlands. Cancellation of 130 million dollars debt from Bangladesh, Sudan, Tanzania and Upper Volta.

Sweden. Cancellation of about 200 million dollars due from eight "least developed" and "most seriously affected" countries, including India, Pakistan and Bangladesh.

Switzerland. Cancellation of approximately 101 million dollars due over 50 years from seven "least developed" and "most seriously affected" countries (including India, Pakistan, Bangladesh and Indonesia).

In answer to another Question by the noble Lord, I have stated what action our own Government has taken.

PERCENTAGE OF INCOME RETAINED AFTER TAX AND SOCIAL SECURITY CONTRIBUTIONS BY A MARRIED MAN WITH 2 CHILDREN UNDER 11 AND EARNED INCOME OF:—
						£ 5,000	£ 10,000	£ 15,000	£ 20,000	£ 25,000
United Kingdom	…	…	…	…	78.5	71.8	64.3	56.6	50.3
USA	…	…	…	…	…	89.5	82 (79.5)	78 (74)	74 (68)	70.5 (64)
France	…	…	…	…	…	95	90	86	82	80
West Germany	…	…	…	…	…	85	76	74	70	67
Italy	…	…	…	…	…	85	75	71	68	66
Canada	…	…	…	…	…	95 (92)	86 (79)	81 (72)	77 (67)	75 (63)
Notes:—
1. All figures relate to income for the 1978 tax year, except: United Kingdom (1978–79), and France (1977—French tax rates are fixed in arrear).
2. For the United Kingdom, the National Insurance contributions have been calculated on the assumption that the taxpayer is not contracted out of the new pensions scheme.
3. The figures take account of personal allowances and reliefs, minimum expense deductions, tax, deductible social security contributions and reliefs for earned income or employment income (income is taken to be employment income where this is taxed more lightly than self-employment income).
4. Any child benefits receivable have been set off against income tax, and the resulting net figures expressed as a percentage of gross income. The figures for the United Kingdom take account of the increase in child benefit payable from November 1978.
5. The figures in brackets include local income taxes. The State income tax shown for the USA is at California rates (no California income tax is chargeable on the dollar equivalent of £5,000) and the Provincial income tax shown for Canada is at Ontario rates.
6. The sterling amounts have been converted into foreign currency at the exchange rates prevailing on 4th October 1978. The exchange rate between the United Kingdom and overseas countries may not fully reflect differences in consumers' purchasing power.

House resumed.