At last, some progress on HIPC: Mali reaches Completion Point

By Romilly Greenhill

11^th March 2003

On March 7^th, Mali – a poor, landlocked country in West Africa – became the seventh Heavily Indebted Poor Country (HIPC) to reach ‘Completion Point’ under the World Bank and IMF’s enhanced HIPC initiative[1].

Mali had already received some debt cancellation under HIPC. In September 2000, she

was awarded a write-off of $121m in nominal terms, or some 9% of her total debt, under the ‘original’ HIPC initiative. The additional relief now provided under the ‘enhanced’ HIPC initiative will bring down her debt by much more - $401m in nominal terms, or a further 28% of total debt. However, this still leaves Mali with an outstanding debt burden of approximately $2.2bn, almost 100% of her GDP.

Despite this high debt burden, Mali is not considered to need any ‘topping up’ of relief in order to reach sustainable levels of debt under the HIPC initiative. Many countries have been hard hit by falling commodity prices which has meant that their debt-to-export ratios have rocketed beyond the 150% deemed ‘sustainable’ under the HIPC criteria. However, countries such as Mali, because their exports have been performing relatively well, are not eligible for any further relief.

Mali is the first country for almost a year to receive any write-off of debt under the HIPC initiative, which campaigners have criticised for failing to keep to the schedules promised to the international Jubilee 2000 campaign[2]. The recent announcement means that total debt cancellation has now risen to $36.5bn, out of a total commitment of some $111bn[3].

For more details on Mali’s debt, see our ‘Mali’ country profile, available at http://www.jubileeresearch.org/databank/profiles/mali.htm  Once the Completion Point document for Mali is made publicly available, we will be updating the profile and providing a full analysis of Mali’s Completion Point deal.