=?X-UNKNOWN?Q?UK_pledges_=A35bn_debt_relief?=

[Robert Weissman <rob@essential.org>]

BBC
Tuesday, 21 December, 1999, 12:17 GMT
                 UK pledges £5bn debt waiver


                 Crippling debt payments hamper the world's poorest
countries

                 Chancellor Gordon Brown has promised to write off £5bn in
debt
                 owed to Britain by the world's 41 poorest nations

                 But the UK finance minister warned his plan would only
apply to
                 countries promising to use the money to relieve poverty.

                                The announcement was made at a Downing
                                Street seminar called to try to kick-start
an
                                agreement signed last autumn by the
                                world's wealthiest countries to write off
                                £60bn of Third World debt.

                                The government's immediate target is that
                                25 countries will have benefited from debt
                 forgiveness by Britain by the end of 2000.

                 The chancellor said: ""For too
                 long, these countries have been
                 weighed down by the shackles of
                 an unsustainable debt burden.

                 "I want these countries to go into
                 the new millennium free from
                 these shackles and able to invest
                 for the good of their people in health and education."

                 But he warned strings would be attached to the debt
write-off.

                 "Every country to get debt relief will have to a poverty
reduction
                 plan that the International Monetary Fund and World Bank
will
                 look at and agree and for which there will be a timetable
and
                 monitoring.

                 "I think it is important to establish that the debt
relief does not go
                 to military expenditure or to luxury prestige projects or
to waste
                 and bureaucracy and it actually goes to helping the
poorest people
                 in the world."

                 Fast-track relief for poorest

                 So far not one of the 41 highly indebted poor countries
(HIPC)
                 promised assistance under the plan has received any help.


                 Mr Brown signalled last week
                 that once any of the HIPC
                 initiative countries started
                 receiving World Bank and IMF
                 assistance, Britain would forego
                 all its bilateral debt.


                 His latest action will cost the
                 Treasury £640m over the next 20
                 years on top of previous
                 commitments.

                 The chancellor is hoping that
                 other industrialised nations will
                 follow Britain's lead and write
                 off their outstanding loans.

                 Mr Brown wants the first four countries to qualify for
debt relief -
                 Uganda, Mozambique, Bolivia and Mauritania - to be
fast-tracked
                 so that they can start receiving assistance by the end of
January.

                 By August, that figure is expected to rise to 10
countries and by
                 the end of the year it should reach 25.

                 But critics of the plan say that there are insufficient
safeguards to
                 ensure that the benefits of debt relief do not disappear
into the
                 pockets of corrupt officials.


                 Robert Whelan, of the
                 free-market Institute of Economic
                 Affairs, said: "The aid
                 programme has been a massive
                 failure over the last 30 years.

                 "The experience is that most of
                 that money has not been used
                 productively, much of it has been
                 squandered and stolen.

                 "I don't see any reason to assume that debt relief will
improve the
                 situation."

                 However, the secretary of the treasury of Uganda,
Emmanual
                 Tummisiime, insisted that the debt relief programmes
would be
                 properly scrutinised.

                 He said that the extra money would allow his country to
speed up
                 its plans to halve the pupil-teacher ratio in primary
classes from
                 100:1 to 50:1.


                 Uganda would also be able to
                 ensure every primary-age child
                 was taught in a classroom.

                 "It means we can now afford to
                 have the pupil teacher ratio in
                 two years instead of five," he
                 said.

                 He paid tribute to the "moral
                 leadership" given to the world's
                 rich nations by Mr Brown and
                 International Development
                 Secretary Clare Short.

                 But Ms Short said that much
                 credit for the achievement for the
                 relief package should go to the
                 "unprecedented" worldwide movement of churches, charities
and
                 individuals who lobbied for action.

                 But the director of Christian Aid, Dr Daleep Mukarji,
said that
                 although announcement was welcome, the battle against
debt was
                 far from over.

                 "So far, the developed world has forgiven around $100bn
of
                 Third World debt. Gordon Brown has added around $2bn
dollars
                 to this," he said.

                 "Christian Aid believes that at least $300bn must be
forgiven to
                 meet the UN target of halving world poverty by 2015 - a
target
                 signed up to by the British government."