§ 8. Mr. BoswellTo ask the Secretary of State for International Development what assessment she has made of the recent moves in the US Congress to grant $110 million to fund bilateral debt forgiveness. [100355]
§ 24. Mr. Tom ClarkeTo ask the Secretary of State for International Development if she will make a statement on the response by the US Government to Her Majesty's Government's initiatives on the current debt crisis. [100371]
§ Clare ShortThe US Congress decision to provide resources for US export credit debt relief is welcome, as are its agreement to the IMF's financing of its debt relief under the Heavily Indebted Poor Countries (HIPC)576W initiative. However, the agreement on revaluing gold covered only the first tranche. The American pledge to cancel 100 per cent. of its bilateral debts for qualifying HIPCs will only be implemented after these countries have received their HIPC relief. It was therefore very disappointing that the US contribution for the HIPC Trust Fund was not agreed. This means that a substantial financing gap has opened up and this has stalled progress on implementing the revised HIPC initiative. I welcome the US Administration's commitment to pursue a US contribution to the Trust Fund next year.
§ 20. Mr. Ben ChapmanTo ask the Secretary of State for International Development what action her Department is taking to reduce the debt burden of the poorest countries. [100367]
§ Clare ShortMy Department has been working closely with the Treasury on the problem of unpayable debt. Our Government have played a leading role in seeking a permanent solution to the debt problems of the poorest countries. We successfully pressed for a comprehensive Review of the Heavily Indebted Poor Countries (HIPC) initiative last year. Proposals for revising the HIPC framework were agreed in September 1999 at the Annual Meetings of the World Bank and the IMF. The HIPC initiative will now provide twice as much debt relief, and it will be provided more quickly and to more countries. There is also a much stronger link to poverty, to ensure that the poor benefit from the debt relief provided.
My Department has cancelled nearly all the aid debts of the poorest countries, worth around £1.2 billion since 1978, and we provide all our aid on grant terms, so as not to add to the burden of debt. We announced in 1997 that we are willing to cancel the aid debts of the remaining poor Commonwealth countries who are committed to poverty reduction and the international development targets, who are pursuing sound economic policies, who are committed to transparent and accountable government, and who are bearing down on corruption.
My Department also supports capacity building in debt management so that countries can better understand their debt position, negotiate their debt relief and formulate future borrowing strategies.