Campaigners welcome British decision to renounce debt payments, but say more must be done

Campaigners have welcomed the announcement made by UK Chancellor Gordon Brown at Jubilee 2000's final rally to act in the 'spirit of Jubilee 2000' and from December 1^st, to stop collecting or hold in trust all debt payments to the UK from 41 of the world's poorest countries. They have called on the Chancellor now to persuade the IMF, the World Bank and the G7 also to accept that the rich should no longer be taking money from the very poorest.

Gordon Brown made the historic announcement at Jubilee 2000's rally on December 2^nd, 'The World Will Never Be the Same Again.' To loud applause from campaign supporters, the Chancellor said:

"I say to you, when the need is so great, and the need is so urgent, that it's time to ensure that the richest countries who have so much should not receive from now any further benefits from the debts of these countries who have so little. So I can say to you, and to all 41 of the HIIPC countries, and on behalf of the British Government that Clare Short and I will, from today and in the spirit of Jubilee 2000, renounce our right to receive any benefit from these historic debt owed by the 41 countries."

Sekou Diarra, Co-ordinator of the Jubilee 2000 campaign responded to the announcement by saying: “The National Coalition of Mali/Jubilee 2000 has learnt and much appreciated the gesture of the British government which consists of abandoning the debt services of the 41 poorest countries. We do appreciate this gesture but we say that it's not enough because the total and immediate debt cancellation remains our main objective. The fight continues.”

The total owed to Britain by the 41 countries at the end of March 2000 was £2 billion. In December 1999, the British Government announced that it would cancel all debt owed to it for countries that reached 'decision point' – the halfway stage - in the Heavily Indebted Poor Countries Initiative. By December 2000 12 countries had reached decision point and the World Bank and IMF are hoping to have at least 20 countries at this point by the end of 2000. The new initiative applies to countries which have not already reached decision point in the HIPC initiative. For these countries, which do not have poverty reduction strategies in place, any payments made to Britain after December 1^st 2000 on existing debt will be kept in a trust fund and returned to the country when it can be shown that the money will be used for poverty reduction.

Responding to the announcement on Saturday 2^nd December, Ann Pettifor, Director of Jubilee 2000 said: "On this very special day, this is a fantastic boost to Jubilee 2000's supporters who have been asking the government to Stop Taking the Money from the poor. But to make a real difference, the Chancellor must now persuade the IMF, the World Bank and the G7 to also accept that the rich can no longer get richer on the backs of the poorest."

Campaigners have also pointed to the fact that the initiative fails to include countries like Jamaica, Morocco, Nigeria, Peru, the Philippines and Zimbabwe. Nigeria is a striking omission, as Britain is the largest creditor country for Nigeria. Nigeria owes Britain £3.7 billion, nearly twice the total owed to Britain by all the 41 HIPCs.

The Chancellor's announcement also needs to be put in context of the overall burden of debt on the poorest countries. The total debt of the 41 HIPCs is about $213 billion, or £140 billion. The British initiatives, both from December 1999 and December 2000 cover only £2 billion, or under 1% of the total debt of these countries. The total debt service paid each year by the 41 countries is still in the region of $9 billion, of which only $42 million is paid to the UK. Campaigners will therefore be pushing for other creditors, in particular the international financial institutions such as the IMF and World Bank to take further steps to cancel the debts of the world's poorest countries. Until they do, as the Mali campaign made clear: "The fight continues.”

• Full briefing on UK announcement