EuropaWorld 5/1/2001 World Bank and IMF Achieve Debt Relief Target But Call on Rich Nations to Do More

The following is an abridged version of a joint year end statement issued by Horst Köhler and James D. Wolfensohn, Presidents respectively of the World Bank and IMF.

In 1996, the IMF and the World Bank launched an initiative to reduce the debt of the poorest countries to sustainable levels as a way to renew their prospects for growth and to free up resources for vital social needs. Last year, we committed to strengthen that initiative. When progress still seemed too slow, we pledged to make every effort to permit at least 20 countries to benefit from debt relief by the end of this year. This goal has been reached and even exceeded.

These efforts will lift some $34 billion in debt service obligations from the shoulders of 22 eligible countries, 18 of them in Africa. As a result, these countries will see their foreign debt reduced by almost half on average. Combined with existing debt relief programs, these countries will see their debts fall, on average, by about two-thirds.

Much hard work and commitment has been required. The countries concerned have shown their willingness to put debt relief to effective use to improve the lives of the poor. They have formulated strategies to reduce poverty, to invest in their people's future, and to create the basis for sustained growth. Together we have laid a strong foundation, and will continue to make every effort to build upon it in all of these 22 countries.

We shall also continue working to bring debt relief to the remaining heavily indebted poor countries. Their already difficult situations are, in many cases, compounded by civil conflict or its immediate aftermath. An end to these conflicts is an essential first step.

There cannot be a good future for the rich nations if the poor nations do not share prosperity. The combination of improved policies and debt relief will not be enough. We need to make sure that the HIPC Initiative is supported by all creditors, including those that have yet to provide the required debt relief. We call upon industrial countries to raise their official development assistance towards internationally agreed levels. And we urge them to open their markets, to the exports of poorer countries.

At the turn of the millennium, many parts of the world are enjoying unprecedented prosperity. But too many people can not yet meet their basic human needs. It is time to redouble our efforts to make the global economy work for the good of all.