§ John BarrettTo ask the Secretary of State for International Development what assessment she has made of the impact which Ethiopia's debt service payments are having on the ability of the Ethiopian Government to combat poverty. [85876]
§ Clare ShortEthiopia qualified for interim debt relief under the Highly Indebted Poor Countries Initiative (HIPC) at Decision Point (DP) in November 2001. Irrevocable relief will be provided at HIPC Completion Point, which is expected within the next two years. Savings resulting from HIPC assistance will amount to around US$ 96 million per year on average until 2021. These resources will be freed up for the Ethiopian Government to use for poverty reduction. Poverty-targeted public expenditure increased by over 1 per cent. of GDP in the current year as a result of HIPC relief.
Ethiopia owes the £UK 15.4 million. Provided Ethiopia remains on track with its programme of economic reform, we would not expect Ethiopia to make any further payments on its debt to the UK after DP.