The UK press reported today that US President George Bush wants 100% cancellation of the debts owed by 41(2) of the world's poorest countries to the World Bank and IMF. If true it would be a great step forward in the campaign to end unpayable Third World debt, and a vindication of the untiring efforts of debt campaigners worldwide. If not, it would represent another gross failure on the part of the rich world to take poor country debt seriously.

JDC, along with debt campaigns across the world has long been campaigning for 100% cancellation of the debts owed by the world's poorest countries. This must begin with full cancellation of the debts owed by the 42 countries that have 'qualified' for the Heavily indebted Poor Countries initiative (HIPC). If delivered this would bring immense benefits to the world's poorest people, in the form of massively increased funds available for health and education. It would be an essential first step to providing the fund necessary to meet basic development targets such as the Millennium Development Goals. Plus, if this reported plan for HIPC countries is in return for agreement by the rest of  the G8 to cancel Iraq's debt, then the latter is an important recognition that debts run up by dictators mustn't be repaid by the people they oppressed.

Bush's reported plan - if true, and implemented - would be a landmark moment. However:

• Resources for debt relief must be in addition to, and not instead of essential development funds: future aid money mustn't pay for today's debt relief.
• It must be implemented rapidly, and the harmful and delaying economic conditions (such as unjustified privatisations) that are often attached to debt relief must be abandoned.
• A plan must be developed to widen to process of debt relief to include many countries outside of HIPC (such as Nigeria and Bangladesh) that deserve debt relief on economic grounds, or because just like Iraq, their debts were run-up by unaccountable dictators.

Guardian Article: http://politics.guardian.co.uk/economics/story/0,11268,1233783,00.html