Haiti

Breaking News: Following the US announcement a day earlier, all G7 countries agreed on 6 February to support cancellation of Haiti’s multilateral debt.

On 12 January 2010 a massive 7.0 magnitude earthquake struck south of the Haitian capital, Port-au-Prince.

For a country like Haiti - the poorest country in the Western Hemisphere - a natural disaster such as this can reverse years of development gains.

Before the earthquake hit, the country faced tremendous challenges. But it had also found great reason to hope. Recent years had brought a more stable government and tenuous gains in the fight against poverty. The country had also reached a significant milestone in the debt cancellation process: $1.2 billion owed to bilateral and multilateral institutions had been completely dropped, erasing most -  but not all - of Haiti's debt.
 
With aid now pouring in, it's time to make sure that our support helps the Haitian people realize their dream for a stronger, more secure nation. While the Haitian and other governments work together on the relief effort, we can help lay the foundation for a smooth recovery and rebuilding effort. First, the international community should cancel Haiti's $1 billion in remaining debt. This will help ensure that future aid goes towards rebuilding a stronger Haiti, not to servicing old debts.

Momentum is really now building to cancel this debt and give Haiti a clean slate as it begins reconstruction efforts. Venezuela has announced plans to cancel its share of the debt, whilst the US and G8 host Canada have  generated impressive momentum for Haiti's debt cancellation. On 5 February, US Treasury Secretary Geithner voiced his support for international debt relief for Haiti, and committed to working with other donors to Haiti's relief efforts to finance recovery and reconstruction through grants, not loans. By providing grants, Haiti will be able to invest all their resources into education, health, the economy-rather than repaying new IOUs.

Thankfully, countries such as the United States have already forgiven Haiti's past debts and now only give assistance in the form of grants. We need Haiti's other creditors -  the International Monetary Fund, World Bank, Inter-American Development Bank, and countries to follow this lead and do the same.