Liberia receives debt cancellation
Liberia - one of the poorest and most indebted countries in the world - has finally received debt relief from the World Bank and IMF (1). Relative to its income, Liberia is the most highly indebted country in the world, with foreign debt levels reaching over 1,000% of Gross National Income at times during the last 10 years.
Liberia is amongst the poorest 20 countries in the world (ranked 169 out of 182 by the UNDP), where 84% of the population live in extreme poverty. The country was torn apart by warlordism and civil war in the 1990s, following decades of exploitation and unjust lending by the US and other rich countries.
Nick Dearden, Director of Jubilee Debt Campaign (2), said:
"We are delighted that Liberia has had 90% of its debts cancelled at last. The country should never have waited so long for the wheels of the debt relief schemes to turn. As with so many other countries, debt cancellation for Liberia has meant sizeable debt payments as well as implementation of IMF conditions.
"The people of Liberia have suffered twice over - once from vast quantities of unjust debts which propped up dubious governments without benefiting ordinary people, and second from being forced to forgo development while those debts were ‘repaid'.
"It is the international community that surely owes Liberia a debt for 200 years of mistreatment. We hope that this cancellation represents a new beginning for Liberia in which that debt is repaid through increased levels of aid without damaging conditions."
Liberia is the 29th country to reach ‘completion point' under the HIPC Initiative. Completion point marks the end of the process at which time all debts run-up before the ‘cut off' date are cancelled.