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Comité pour l'abolition des dettes illégitimes

Initiative for the heavily indebted poor countries (HIPCs)

In 1996 the IMF and the World Bank launched an initiative aimed at reducing the debt burden for some 41 heavily indebted poor countries (HIPC), whose total debts amount to about 10% of the Third World Debt. The list includes 33 countries in Sub-Saharan Africa.

The idea at the back of the initiative is as follows : a country on the HIPC list can start an SAP programme of twice three years. At the end of the first stage (first three years) IMF experts assess the ’sustainability’ of the country’s debt (from medium term projections of the country’s balance of payments and of the net present value (NPV) of debt to exports ratio.

If the country’s debt is considered « unsustainable », it is eligible for a second stage of reforms at the end of which its debt is made ’sustainable’ (that it it is given the financial means necessary to pay back the amounts due). Three years after the beginning of the initiative, only four countries had been deemed eligible for a very slight debt relief (Uganda, Bolivia, Burkina Faso, and Mozambique). Confronted with such poor results and with the Jubilee 2000 campaign (which brought in a petition with over 17 million signatures to the G7 meeting in Cologne in June 1999), the G7 (group of 7 most industrialised countries) and international financial institutions launched an enhanced initiative : « sustainability » criteria have been revised (for instance the value of the debt must only amount to 150% of export revenues instead of 200-250% as was the case before), the second stage in the reforms is not fixed any more : an assiduous pupil can anticipate and be granted debt relief earlier, and thirdly some interim relief can be granted after the first three years of reform.

Simultaneously the IMF and the World Bank change their vocabulary : their loans, which so far had been called, « enhanced structural adjustment facilities » (ESAF), are now called « Growth and Poverty Reduction Facilities » (GPRF) while « Structural Adjustment Policies » are now called « Poverty Reduction Strategy Paper ». This paper is drafted by the country requesting assistance with the help of the IMF and the World Bank and the participation of representatives from the civil society.
This enhanced initiative has been largely publicised : the international media announced a 90%, even a 100% cancellation after the Euro-African summit in Cairo (April 2000). Yet on closer examination the HIPC initiative turns out to be yet another delusive manoeuvre which suggests but in no way implements a cancellation of the debt.

List of the 42 Heavily Indebted Poor Countries : Angola, Benin, Bolivia, Burkina Faso, Burundi, Cameroon, Central African Republic, Chad, Comoro Islands, Congo, Ivory Coast, Democratic Republic of Congo, Ethiopia, Gambia, Ghana, Guinea, Guinea-Bissau, Guyana, Honduras, Kenya, Laos, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Myanmar, Nicaragua, Niger, Rwanda, Sao Tome and Principe, Senegal, Sierra Leone, Somalia, Sudan, Tanzania, Togo, Uganda, Vietnam, Zambia.

Debt Cancellation for Somalia

7 February 2019 - by Somalia NGO consortium

You will find below a report on Somalia’s sovereign debt which was issued by a consortium of NGOs. While some of their recommendations and their approach to possible solutions to the debt crisis are not completely in agreement with the CADTM’s (...)
Debt audit: An alternative weapon against state capture

20 February 2017 - by Mary Serumaga

Many African nations are mired in huge debts arising from foreign loans that have hardly benefitted the people. The citizens need to audit these debts. Odious debts should be repudiated, damn the consequences. Moreover, as Thomas Sankara (...)
World Debt Figures 2015 : Chapter 4

The World Bank and the IMF

23 February 2015 - by Eric Toussaint, Daniel Munevar, Pierre Gottiniaux, Antonio Sanabria

Multilateral financial organisations are at the core of the ‘debt system’. Since they were established in 1944 (in the framework of the Bretton Woods Agreement), the World Bank and the IMF have used debt as a mechanism to promote the (...)
International Campaign on Illegitimate Debt

Resolution of solidarity and support for the people of Haiti

Between August 15 and September 7, 2008, the Caribbean was severely hit by four successive hurricanes (Fay, Gustav, Hanna, and Ike) that devastated several regions with disastrous consequences in particular for the peoples of Cuba, the Dominican (...)
The World Bank suddenly discovers 400 more million poverty-ridden people

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The World Bank recently acknowledged significant mistakes in its figures concerning poverty in the world. Indeed, while “the WB’s estimates of poverty are improved thanks to more reliable data on the cost of living”, the outcome is a head-on (...)
Kyrgyzstan

Kyrgyz Protesters Target World Bank Debt Scheme

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Zambia: Debt Reduction Doesn’t Guarantee Debt Sustainability - World Bank

5 September 2006 - by Mwila Nkonge

DEBT reduction is insufficient for debt sustainability, the World Bank has noted. Article by Mwila Nkonge published in The Post (Lusaka).
International press

What the World Bank and Inter-American Development Bank Owe Haiti

5 August 2006 - by Dan Beeton

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G8 debt deal one year on:

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Press Release

The CADTM appalled by World Bank’s empty promises on debt

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Failure to Act on 100% Debt Cancellation a Tragedy, Will Cost Lives

US Movement for Debt Cancellation Outraged by G-8 Failure on Debt

13 June 2004 - by The 50 Years Is Enough Network, Jubilee USA

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Bankrupt Africa

12 March 2004 - by Patrick Bond

Debt peonage continues, courtesy of Washington, Monterrey and NEPAD.
Poverty Reduction? or PRSP?

11 March 2003 - by Shalmali Guttal

PRSPs will create and entrench policy-induced poverty. They will have little to do with poverty reduction in any meaningful sense. But they will certainly strengthen the grip of the Washington Consensus on the policy environments of recipient (...)