Debt relief  

Liberia Wins $4.6 Billion in Debt Relief
The IMF and the World Bank decided to support June 29 the final stage of debt relief for Liberia that in total amounts to $4.6 billion in nominal terms.

Debt relief reduces Liberia’s external debt stock by more than 90 per cent to about 15 percent of GDP.

The decision was reached after Liberia met the requirements for achieving the final step, or completion point, under the enhanced Heavily Indebted Poor Countries (HIPC) Initiative. The IMF’s share of this debt relief amounts to about $730 million in end-June 2007 present value terms—among the largest IMF country commitments under the enhanced HIPC Initiative, representing over one-fifth of the total financial support for the HIPC process.
June 29, 2010

IMF and World Bank announce US $ 4.6 billion Debt Relief for Liberia

The International Monetary Fund (IMF) and the World Bank's International Development Association (IDA) have decided to support US$4.6 billion of debt relief for Liberia, of which US$1.5 billion is to be delivered by multilateral creditors and the remainder by bilateral and commercial creditors. This was made possible in part by the exceptional efforts of members of the international community to finance debt relief for Liberia.

Debt relief under the Enhanced Heavily Indebted Poor Countries (HIPC) Initiative from all Liberia’s creditors was estimated at US$ 2.7 billion in end-June 2007 present value terms. Debt relief from the IMF would total US$730 million—the IMF’s biggest ever HIPC contribution for a single country—and from the World Bank’s IDA, US$374 million.

After reaching the HIPC completion point, Liberia also becomes eligible for further nominal debt reduction from IDA (US$66.9 million) and the African Development Bank (US$17.2 million) under the Multilateral Debt Relief Initiative (MDRI) and beyond-HIPC assistance from the IMF (SDR117.4 million or US$173 million) and the EU Special Debt Relief Initiative (US$0.9 million).

As a result of this relief, Liberia will no longer face a heavy debt service burden in relation to its revenue and foreign exchange resources.

The Boards determined that Liberia has taken the necessary policy actions to reach the completion point, and therefore debt relief from both the HIPC Initiative and MDRI becomes irrevocable. Liberia has successfully implemented its poverty reduction strategy and maintained a stable macroeconomic environment, despite the global economic crisis.
June 29, 2010

IMF, World Bank clear Liberia for debt relief
The IMF and World Bank on Tuesday cleared Liberia's entry into a global debt relief program, a vital step toward canceling the country's $4.7 billion debts and helping it rebuild from civil war.
March 19, 2008

Liberia slowly edging towards debt cancellation
"Liberia, one of the poorest countries in the world, has debts of more than 3.5 billion dollars. It is now edging towards debt cancellation, with some support from rich countries: but Liberia's debts, which are anyway of dubious legitimacy, need to be cancelled now."
Januari 12, 2007

EU Needs to Cancel Liberia’s Illegitimate Debt and Pledge New Money
“Liberia’s indebtedness deserves the understanding of both Liberians and the international community. We are faced with a total inability to service our debts”.
November 14, 2006

Experts Available to Discuss Liberia's Crippling Debt During President's U.S. Visit 
"Creditors are currently insisting that Liberia pay $1.5 billion in back payments and accumulated interest before it can become eligible for any debt relief or cancellation. This in a country whose government operates with an annual budget of just $80 million."
October 17, 2006

Liberia needs urgent debt cancellation and aid
"African and European CSOs launch call for immediate and unconditional debt cancellation for Liberia.
The Center for Democratic Empowerment (Liberia) and AFRODAD, supported by civil society organisations in West Africa and EURODAD, have launched joint efforts to call for immediate and unconditional debt cancellation for post-war Liberia, coupled with increased levels of donor assistance. The call was made at a three day dialogue on “Post-Conflict Liberian Debt, Aid and Development” in Monrovia."
September 21, 2006

The Multilateral Debt Relief Initiative (MDRI)
The Multilateral Debt Relief Initiative (MDRI) provides for 100 percent relief on eligible debt from three multilateral institutions to a group of low-income countries. The initiative is intended to help them advance toward the United Nations' Millennium Development Goals (MDGs), which are focused on halving poverty by 2015.

Debt Relief Under the Heavily Indebted Poor Countries (HIPC) Initiative
The HIPC Initiative is a comprehensive approach to debt reduction for heavily indebted poor countries pursuing IMF- and World Bank-supported adjustment and reform programs. To date, debt reduction packages have been approved for 29 countries, 25 of them in Africa, providing US$35 billion (net present value terms as of the decision point) in debt-service relief over time. Eleven additional countries are potentially eligible for HIPC Initiative assistance and may wish to avail themselves of this debt relief.



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