G8 agrees to cancel £22bn of debt

By Andy McSmith
Monday 10 February 2014 16:30

Eighteen of the world's poorest countries are to have debts totalling £22bn written off after a landmark deal was reached in London yesterday by finance ministers from the richest nations.

The deal, announced by the Chancellor, Gordon Brown, was acknowledged as a breakthrough by aid agencies working in Africa - although they added a warning that debt relief will go only part of the way to achieving the millennium goal to "make poverty history".

The deal means that the World Bank, the International Monetary Fund and African Development Fund will immediately write off $40bn owed by the 18 poorest countries - 14 of which are in Africa. Between them, they will be spared about $1.5bn a year in debt repayments - money they will be expected to spend on vital services such as health and education. Another 20 countries could qualify later.

"We are presenting the most comprehensive statement that finance ministers have ever made on the issues of debt, development, health and poverty," Mr Brown said.

He added that the plan set the stage for next month's G8 summit, where world leaders intend "to forge a new and better relationship, a new deal between the rich and poor countries of the world".

The US Treasury Secretary, John Snow, hailed the deal as "historic", while relief agencies gave it a guarded welcome. Romilly Greenhill of ActionAid said: "The debt deal is very good news for people in the 18 countries that will benefit, but it will do little to immediately help millions in at least 40 other countries that also need 100 per cent debt relief."

Campaigner Bono, of U2, urged African nations to meet the conditions: "If the other countries are prepared to do the same, they will also benefit. I've been working on this for seven years and it's very exciting. This is a very big night right now."

Anna Thomas, a senior policy adviser for Christian Aid and part of the Make Poverty History campaign, said: "We have a deal on debt, it is a small beginning and will make a real difference to people's lives in the 18 countries which will receive immediate help."

The 18 countries expected to benefit straight away are Benin, Burkina Faso, Ethiopia, Ghana, Madagascar, Mali, Mauritania, Mozambique, Niger, Rwanda, Senegal, Tanzania, Uganda and Zambia, in Africa, and Bolivia, Guyana, Honduras and Nicaragua, in Central and South America.

Join our new commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

View comments