GEORGETOWN, Guyana, CMC – Guyana is pushing for the hemispheric Inter-American Development Bank (IDB) to write off its US$447 million debt to the institution to help boost the country’s anti-poverty fight, a senior government official said.
Head of the Presidential Secretariat, Dr Roger Luncheon said: “the size of IDB lending in Latin America is such that extending the initiative to cancelling debt owed to the IDB would almost triple the resources that the initiative could make available for poverty reduction in Latin America and the region,” he said.
If the IDB accedes to the country’s request, it means that some 50 percent of Guyana’s existing external debt stock, at the end of 2004, would be wiped out.
At the 91st meeting of the IDB Committee of Governors in Washington on July 17, President Bharrat Jagdeo “strongly lobbied” for debt forgiveness, the Government Information Agency (GINA) said in a statement.
Last December, the Executive Board of the International Monetary Fund (IMF) completed the assessment of the first group of countries eligible for relief under the historic Multilateral Debt Relief Initiative (MDRI) and granted 100 per cent relief to 19 countries totalling US$3.3 billion.
Guyana was listed with Benin, Bolivia, Burkina Faso, Cambodia, Ethiopia, Ghana, Honduras, Madagascar, Mali, Mozambique, Nicaragua, Niger, Rwanda, Senegal, Tajikistan, Tanzania, Uganda and Zambia as beneficiaries of the pact.
The decision which released debt forgiveness earlier this year, allows these countries to hike spending in priority areas to reduce poverty, promote growth, and “to make progress towards achieving the Millennium Development Goals (MDGs),” GINA said.
“The Multilateral Debt Relief Initiative paved the way for significant debt relief by cancelling debt owed by HIPC countries to several financial institutions including, the IMF, World Bank and the African Development Fund.
“That initiative however left some countries, particularly the HIPC countries outside Africa, with a still significant debt burden and one especially to other International Financial Institutions,” Luncheon observed.
In 1992, Guyana used 94 per cent of its Gross Domestic Product (GDP) to service its US$2.1 billion debt, a figure which dipped to some 18 per cent after the HIPC initiative