UK ministers meet IMF in Washington in the first of a series of pre-Prague meetings on debt

The approaching World Bank and IMF annual meetings have sparked a flurry of activity from the UK government and the IMF. In a letter to Jubilee 2000, International Development Secretary Short and Chancellor Gordon Brown outlined a programme of meetings in the next few weeks where debt will be the main issue in the run-up to Prague.

On 30 August, Ms Short and Mr Brown travelled to Washington to meet the heads of the IMF and World Bank, to discuss ways of "energising HIPC" - the Heavily Indebted Poor Countries Initiative, which was launched in 1996 with the aim of providing an exit from the debt crisis for the poorest indebted countries. In a BBC interview before the meeting, Ms Short said “We have got delays in the system that Gordon [Brown] and I will do everything in our power to get rid of ... We need to keep up the pressure ... there has been a danger of delay in Washington.''

Adrian Lovett, Deputy Director of Jubilee 2000 told the BBC: "The international effort to relieve debt has become hopelessly bogged down in red tape. The government's promise to help more countries receive debt relief will be broken unless HIPC is radically transformed. Meanwhile, the UK could take a further lead and immediately stop taking payments from the poorest countries."

Following the meeting in Washington, the UK Treasury said that the Bank, the Fund and the UK Government were determined to ensure as many countries as possible start to receive debt relief by the end of this year, and they would take the steps necessary to do this. The spokesperson declined to outline what these steps were.

The Department for International Development said that certain countries in conflict like Sudan and Burma were holding up the progress of the HIPC initiative. However, neither of these – nor any of the 10 HIPC “conflict countries” – are on the list of 20 countries that creditors have promised will start getting debt relief before the end of the year.

This target, set by the G8 Summit in Okinawa in July, is reduced from the 25 promised last year. So far, only 9 of the 20 have qualified for a partial reduction in their debt payments (and not one country has had any debt actually cancelled).

Other obstacles, such as meeting harsh economic conditions imposed by the IMF, are delaying the remaining countries on the list for this year. There is no evidence that the UK government, or the IMF or World Bank, are taking steps to end the linking of debt cancellation to IMF economic conditions which take years to implement.

On September 8th, IMF Managing Director Horst Köhler will meet with debt campaigners at a meeting in London hosted by Clare Short and Gordon Brown. Then, on 19 September, Gordon Brown will raise the debt issue with the Commonwealth Finance Ministers at their annual summit in Malta.

The World Bank and IMF annual meetings, where debt will be a headline item on the agenda, take place in Prague from 19 – 28 September. Campaigners from all over the world are gathering in the city, and Jubilee 2000 will be holding a Debt March on Sunday 24^th.