Multilateral Debt Relief Initiative

Facts

Disadvantages

Qualifications

Advantages

World Bank and G8 nations cancelled all debts owed to the IMF, IDA and African development Fund debts

Aimed to help HIPC only (21 countries- 315m people)

January 6th 2006

$36 billions in 2006
Potentially $50b in the next 40 years

25 million children are put into schools with $1.25b

Zambia: 4500 new teachers

Tanzania: subsidised food for 3.7 million

Increased spending on health, education and crucial areas to develop the economy

Uganda gets 80% of its debt cancelled

Undemocratic and damaging strings attached

Exclude important regional development banks

HIPC includes too few countries

Designed and controlled by creditors

Cancelled at low rate( $1.25b a year is equivalent to0.2% of world spend on defense→ poor countries have no chance of meeting Millennium Development goal

The Jubilee Debt Campaign called for at least $10b of cancelled debt a year

Agree to IMF economic policy for 3 years

Agree to follow IMF for another 3 years

Prove that the debt is unsustainable