Cote d’Ivoire receives badly needed debt relief

Apr 7th, 2009 1:28 PM UTC
By Andreas.Huebers

On March 31, Cote d’Ivoire reached the “decision point” under the HIPC-initiative. Cote d’Ivoire is the 29th African country to reach the decision point. The West-African country can now stop servicing around $ 3 billion worth of mainly bilateral debt and start spending it on urgently needed health and education policies instead. The debt stock will only be cancelled when it reaches the final stage of the Highly Indebted Poor Country Initiative (HIPC): the completion point.

At this point around $ 3 billion in mainly bilateral debt and $2 million USD in multilateral debt will be cancelled. The Worldbank and IMF are optimistic that this can happen rather rapidly. In the HIPC-process this means probably more than a year. The International Financial Institutions have good reasons to move Cote d’Ivoire to “completion point”: Cote d’Ivoire is a post-conflict country at a critical stage of its development. A Peace Accord between the government and the rebels was signed in 2007 and has proved stable since then. The interim debt relief that comes with reaching decision point is a good first step. But the benefits of full debt relief could contribute even more substantially in helping the country to stabilize and develop.

-Andreas Huebers

TAGS: Debt Cancellation, Policy News