| Related Links: | Articles on debt write offs |
| Letters Menu | Archival Menu |
Guyana is among five countries that will benefit from an Inter-American Development Bank debt relief package for the most indebted poor countries of Latin America and the Caribbean.
According to a press release from the Government Information Agency (GINA) IDB governors at a meeting held in Washington DC yesterday, reached an agreement on the framework for a debt relief package, which will result in the debts of Guyana, Bolivia, Haiti, Honduras and Nicaragua being cancelled.
President Bharrat Jagdeo, who left Guyana on Thursday to attend the meeting, had said prior to his departure that Guyana could benefit from as much as US$400M in debt relief, should lobbying efforts be successful.
The principles of the framework stipulate that 100 percent debt relief would be granted, with effect from January 1, 2007, to the five countries eligible for the concessional Fund for Special Operations (FSO) window of the IDB, the release said.
These five countries will continue to have access to concessional loans and technical cooperation grants from the IDB.
The GINA release added that the specific details of the package, such as the cut-off date and the definition of the eligible debt would be decided at a subsequent meeting of the Committee of Governors. This will be held in time for the agreements reached to be presented to the annual meeting of the IDB Board of Governors in Guatemala, in March 2007.
Governors will vote electronically for the final detailed debt relief package. However it is expected to be approved, given the level of support that has already been expressed for the framework by shareholders of the IDB such as the United States of America and Brazil.
The agreement reached yesterday represents a significant step towards concluding the extension of the Multilateral Debt Relief Initiative (MDRI) to include cancellation of debts owed by HIPCs to the IDB.
Under the MDRI, debts owed by the HIPCs to the International Monetary Fund, the World Bank's International Development Association (IDA), and the African Development Fund (ADF), have already been written off, the release said.
The IDB was established in 1959 to provide financing to Latin American countries. It is owned by its 47 members, with borrowing members holding about 50 percent of total votes and non-borrowing members holding the other half. The US, with a third of the votes, is the biggest member.