As far as I can remember, poor countries have been exploited by banks and richer countries by borrowing money from them. Because of this, the Heavily Indebted Poor Countries (HIPC) was initiated in 1996 and further amended in 1999 to speed up the debt relief for the poor countries. By enhancing the HIPC, a broader group of countries were allowed to qualify for larger volumes of debt relief. With the HIPC initiative, creditors are able to cut down the debt of countries by 90% but many are still finding it difficult to pay up due to the vulture creditors.
As we read last week, Liberia just got it's debt cancelled.
Mostly, African countries are involved in the HIPC initiative. They are all on different levels; for example, Rwanda is in the completion level. This means that they have maintained macro economic stability, carried out structural reforms prescribed by the IMF and implemented the poverty reduction strategy. The Democratic Republic of Congo is in the decision point; this means that they have set up a poverty reduction strategy and have established a track record of macro economic stability and finally, Somalia is one of the few countries in the pre-decision level which means that they have been accepted for the participation of the HIPC program but have not yet fulfilled their duties to receive debt relief or comprehensive debt stock forgiveness.
The global community must do more to support the vision of an Africa driven by its own citizens. While existing individual country commitments will continue to drive progress, a renewed collective commitment would enhance accountability and ensure cohesion. The ONE campaign recently released a new report which highlights that "Developing countries must do better at holding accountable those who break their promises and above all do more to ensure that policies beyond development assistance are better leveraged for African development- in particular policies which strengthen governance, fight corruption and spur sustainable, equitable economic growth." I couldnt't agree more.
Coming from and African country, I know and can say that debt cancellation is very important to us. This is because laws and privatization of companies are created to the benefit of the lender country and not the citizens of the country. This is a serious form of exploitation and slavery because we know that if our debt is not cancelled, it will take us years to pay our debt. Working in Jubilee USA has been an eye opening experience because I see first hand how people are working to appeal to the American government to cancel the debt of poor countries, especially those that are just recovering from wars and natural disasters.
Though we haven’t achieved everything yet, we have made progress. As the world looks beyond 2010, we at Jubilee are continuing to work for the unfulfilled promises be delivered and to improve on what has begun, including building stronger partnerships with Africa so we can end the extreme poverty in our time.