§ 9. Mr. CorbynTo ask the Secretary of State for International Development what policies are being followed by her Department to prevent debt-relieved countries becoming indebted again. [89760]
§ Clare ShortThe revision to the HIPC Initiative, which we hope will be finalised at the annual meeting of the World Bank and the IMF in September, will provide more debt relief to countries following sound pro-poor policies. This will increase the likelihood of countries achieving a permanent exit from their debt problems.
217WWe provide all our aid through grants, not loans, and are encouraging others to do the same. We are also working to try to ensure that export credits are not provided for non-productive expenditure.
We are working with the World Bank and the IMF to bear down on corruption and to ensure that the Bank and the Fund support economic policy and social spending that benefit the poor.
§ 13. Ms RyanTo ask the Secretary of State for International Development what contribution her Department is making to the Government Review of the Heavily Indebted Poor Countries Initiative. [89764]
§ Clare ShortWe are working closely with the Treasury to influence the Heavily Indebted Poor Countries (HIPC) Review being carried out by the World Bank and the International Monetary Fund. In the first phase, we submitted a joint paper on the need for faster, deeper and wider debt relief, and I am pleased that there is now an international consensus that more debt relief is required for countries committed to eradicating poverty. The second phase of the Review is currently under way and is examining how the link between debt relief and poverty reduction can be strengthened. We have recently submitted a further joint DFID and Treasury paper to the Review team, setting out our ideas and proposals. Decisions on this will be taken at the Annual Meetings of the IMF and the World Bank in September. Both papers are available in the Library.
§ 15. Sir Sydney ChapmanTo ask the Secretary of State for International Development if she will report progress in tackling and reducing the debt of the heavily indebted poorer countries, following the Cologne summit. [89766]
§ Clare ShortThe Cologne Debt Initiative represents a major step forward in the effort to remove the debt burden of the poorest countries. We welcome the commitment to a major improvement in the Heavily Indebted Poor Countries (HIPC) Initiative so that it delivers faster, wider and deeper debt relief to countries committed to eradicating poverty. If agreed at the annual meetings of the World Bank and the IMF, the HIPC initiative will provide twice as much debt relief, twice as quickly. It is also important that there was a call to cancel outstanding aid debts. These amount to —20 billion owed to the G7 countries alone. The UK has already cancelled the aid debts of the poorest countries, and we are pressing others to follow our lead. The UK has also made the largest pledge to the Millennium Trust Fund—a total of —171 million. It is important that everyone plays their part in funding the enhanced debt relief, and we are calling on the European Commission to make a substantial contribution.
§ 22. Mr. HeppellTo ask the Secretary of State for International Development what recent discussions she has had with NGOs on the progress of the heavily indebted poor countries initiative. [89773]
§ Clare ShortI regularly meet representatives from the NGOs to discuss key development issues including debt. At a meeting last month with the Directors of those NGOs which form the British Overseas Aid Group (BOAG), we discussed the G7 initiative on debt launched at the Cologne218W Summit. We also considered the second phase of the HIPC Review, which is examining how the link between debt relief and poverty reduction can be strengthened.