The Debt-Relief Initiative for Poor Countries: Good news for the poor?
& Frances Stewart
Published: September 2001
This paper reviews the new debt-relief initiative for Highly-Indebted Poor
Countries (HIPCs) designed to reduce the debt burden of potentially 36 poor
countries. It finds that the HIPC initiative is not likely to make a major
contribution to the problems of the world’s poor. It offers limited and highly
conditional resources, most of which are not likely to be additional to existing
resource flows; the resources are not distributed according to need; and the policy packages accompanying HIPC are unlikely to do much for the major
development problems that are constraining these countries’ development
efforts. A major problem with the initiative is that it excludes all the populous poor countries, so that the vast majority of the poor of the world will not be
touched by it.