Burundi qualifies for some debt relief

Burundi has become the 28th country to get debt relief through the major international debt relief scheme - but will only have debts cancelled if it complies with the economic policy conditions of the World Bank and IMF.

The relief being offered includes reducing debt service to the World Bank, the IMF and other creditors, which the World Bank states will result in a total reduction of $826 million* in Burundi's debt service payments. Other African countries which have received similar debt relief have been able to abolish primary school fees, giving far more children access to an education; build schools, clinics and roads; and fund teachers, immunisation programmes and other health projects. The relief being offered to Burundi now is a tribute to the worldwide debt campaign, which first persuaded creditors to put a debt relief scheme in place.

However, this step forward has been a long time in coming, and moreover comes at a price. The debt relief is being delivered through the Heavily Indebted Poor Countries (HIPC) initiative. HIPC has been criticised for offering too little, too slowly, and having far too many conditions attached. The scheme was launched in 1996, but this is the first benefit that Burundi has had from it.

Now it is benefiting; but the continuation of the debt relief, and the eventual prize of permanent debt cancellation (which now, thanks to campaigning ahead of the 2005 G8 summit, has been increased to 100% of World Bank, IMF and African Development Bank debts) are conditional on Burundi implementing economic and trade policies dictated by the IMF and World Bank. These kinds of policies are extremely damaging to poor countries, and imposing them in this way undermines democracy.

Nearly 60% of Burundi's population live on less than $1 a day. Jubilee Debt Campaign is calling for full, immediate cancellation of debts for all countries that are not otherwise able to meet their human development needs, without economic policy conditions.

[*In net present value terms.]