For the first 11 countries, debt relief under the enhanced Initiative is only partially received in 2000. The impact of the enhanced Initiative will be fully felt from 2001 onwards.

• From 2001, all countries pay less debt service after assistance under the HIPC Initiative than they did on average in 1998-1999.

• For 2001-2003, the HIPC Initiative reduces the average debt service paid by about one third.

• While in some cases debt service rises from the 2001 levels, all countries pay less than the average for 1998-1999 every year through 2005.

• Debt service drops sharply in relation to exports or fiscal revenues over this period. On average these ratios fall by one-half.

• In all cases, social expenditures are expected to increase in 2000-2003 from the levels in 1998/1999.

• For all these countries, social expenditures are projected to be significantly higher than debt service due in 2001-2002. On average, social expenditures will be more than three times debt service.

As data for additional countries is posted, these characterizations will be subject to some variation. However, assistance from the HIPC Initiative is expected in aggregate to result in substantial reductions in debt service due and paid, opening new possiblities for qualifying countries.

Sources and coverage

Most of the data used has come from the decision point documents considered by the Executive Boards of the IMF and the World Bank in deciding to grant HIPC relief, as noted below. The data presented are the best available. However, the Initiative is targeted at some of the poorest countries on earth, and the statistical systems of these countries have limitations that reflect this fact. What is more, the coverage of data on social spending and poverty varies considerably across countries.

IMF and World Bank staff have assembled the attached tables on the following basis:

• Debt service for 1998-2005 (Table 1): The data are based mostly on the decision point documents for the 11 HIPCs that have reached their decision points under the enhanced HIPC Initiative as of end-October 2000. For debt service paid in 1999, more updated information is used for Senegal and Uganda.

• Social expenditures for 1998-2002 (Table 2): Figures are based mostly on the decision point documents. In the case of Cameroon, data compiled by the staff teams at the time of the decision point are used because there is only partial information in the decision point document.

The coverage is quite different across countries. In principle, all of the social spending numbers include health and education spending, though in places--notably Mozambique and Burkina Faso--these figures are incomplete. In addition, social expenditure data includes new programs to be financed partly by HIPC Initiative assistance in Benin, basic sanitary infrastructure in Bolivia, rural development and water supply in Burkina Faso, social safety net and rural development programs in Honduras, poverty reduction programs in Mauritania, other spending including promotion of women in Senegal, and water supply in both Tanzania and Uganda.

Local currency figures are converted into U.S. dollars using relevant period average exchange rates.

 

Table 1: Debt Service for HIPCs that Have Reached Their Enhanced Decision Points, 1998-2005 (In million of US dollars, unless otherwise indicated)
	1998	1999	2000	2001	2002	2003	2004	2005
Benin
Debt service paid	64	66
Debt service due after enhanced HIPC Initiative    relief1			63	46	43	39	39	37
Debt service/exports (in percent)2	16	17	17	11	9	8	7	6
Debt service/fiscal revenue (in percent)2	17	18	15	9	8	6	6	5
Bolivia
Debt service paid	388	249
Debt service due after enhanced HIPC Initiative    relief1			277	185	212	235	254	278
Debt service/exports (in percent)2	29	20	20	12	12	12	12	12
Debt service/fiscal revenue (in percent)2	19	13	13	9	9	9	9	9
Burkina Faso
Debt service paid	60	53
Debt service due after enhanced HIPC Initiative    relief1			34	30	35	38	40	41
Debt service/exports (in percent)2	16	18	12	9	10	9	9	8
Debt service/fiscal revenue (in percent)2	18	14	9	7	7	7	7	6
Cameroon3
Debt service paid	401	401
Debt service due after enhanced HIPC Initiative    relief1			312	226	242	291	328	347
Debt service/exports (in percent)2	18	15	11	8	8	9	9	9
Debt service/fiscal revenue (in percent)2	28	24	18	12	12	13	13	12
Honduras
Debt service paid	311	241
Debt service due after enhanced HIPC Initiative    relief1			167	134	210	276	247	258
Debt service/exports (in percent)2	13	10	6	4	6	7	6	5
Debt service/fiscal revenue (in percent)2	32	23	15	10	14	16	13	12
Mali
Debt service paid	74	84
Debt service due after enhanced HIPC Initiative    relief1			88	64	64	66	67	66
Debt service/exports (in percent)2	11	13	14	9	8	8	7	7
Debt service/fiscal revenue (in percent)2	17	18	20	13	12	11	10	9
Mauritania
Debt service paid	88	98
Debt service due after enhanced HIPC Initiative    relief1			87	80	58	49	43	43
Debt service/exports (in percent)2	22	24	20	18	13	10	8	8
Debt service/fiscal revenue (in percent)2	35	35	31	27	19	14	12	11
Mozambique
Debt service paid	104	81
Debt service due after enhanced HIPC Initiative    relief1			50	48	51	54	55	60
Debt service/exports (in percent)2	19	14	9	6	4	4	4	4
Debt service/fiscal revenue (in percent)2	23	17	9	8	7	7	6	6
Senegal
Debt service paid	222	219
Debt service due after enhanced HIPC Initiative    relief1			173	159	145	143	225	134
Debt service/exports (in percent)2	14	15	10	8	7	7	10	5
Debt service/fiscal revenue (in percent)2	27	28	19	16	14	12	18	10
Tanzania3
Debt service paid	224	193
Debt service due after enhanced HIPC Initiative    relief1			154	142	144	148	152	158
Debt service/exports (in percent)2	21	16	12	10	8	8	7	7
Debt service/fiscal revenue (in percent)2	22	20	14	12	11	11	10	9
Uganda3
Debt service paid	110	98
Debt service due after enhanced HIPC Initiative    relief1			48	51	56	68	94	103
Debt service/exports (in percent)2	15	13	5	5	5	5	7	7
Debt service/fiscal revenue (in percent)2	16	13	5	5	5	5	6	6
Total Debt Service paid	2,045	1,783
Total Debt Service due			1,453	1,164	1,259	1,407	1,543	1,527
Average Debt Service/Exports (in percent)2	18	16	12	9	8	8	8	7
Average Debt Service/Fiscal Revenue (in percent)2	23	20	15	12	11	10	10	9
Source: Country authorities; and IMF and World Bank staff estimates. 1Debt service due after the full use of traditional debt relief mechanism and assistance under the Enhanced HIPC Initiative. 2Ratios for 1998 and 1999 are debt service paid to exports or revenue; ratios for 2000 onward are debt service dueafter HIPC assistance to exports or revenue. 3On fiscal year basis, i.e. 2000 column shows FY 2000/01.

 

Table 2: Social Expenditure for HIPCs that Have Reached Their Enhanced Decision Points, 1998-20021 (In million of US dollars, unless otherwise indicated)
	1998	1999	2000	2001	2002
Benin
Social expenditure	99	115	148	195	. . .
Social expenditure/fiscal revenue (in percent) 2	26	31	36	39	. . .
Social expenditure to debt service3	2	2	2	4	. . .
Bolivia
Social expenditure	828	865	946	. . .	. . .
Social expenditure/fiscal revenue (in percent) 2	41	44	46	. . .	. . .
Social expenditure to debt service3	2	3	3	. . .	. . .
Burkina Faso
Social expenditure	110	141	142	165	192
Social expenditure/fiscal revenue (in percent) 2	32	36	37	39	40
Social expenditure to debt service3	2	3	4	5	5
Cameroon4,5
Social expenditure	231	264	316	389	451
Social expenditure/fiscal revenue (in percent) 2	16	16	18	21	22
Social expenditure to debt service3	1	1	1	2	2
Honduras
Social expenditure	368	443	723	754	884
Social expenditure/fiscal revenue (in percent) 2	37	42	63	57	58
Social expenditure to debt service3	1	2	4	6	4
Mali
Social expenditure	. . .	. . .	136	163	177
Social expenditure/fiscal revenue (in percent) 2	. . .	. . .	31	33	33
Social expenditure to debt service3	. . .	. . .	2	3	3
Mauritania
Social expenditure	75	85	97	111	121
Social expenditure/fiscal revenue (in percent) 2	30	30	34	37	38
Social expenditure to debt service3	1	1	1	1	2
Mozambique
Social expenditure	113	158	192	. . .	. . .
Social expenditure/fiscal revenue (in percent) 2	25	32	36	. . .	. . .
Social expenditure to debt service3	1	2	4	. . .	. . .
Senegal
Social expenditure	243	257	258	277	. . .
Social expenditure/fiscal revenue (in percent) 2	30	33	29	29	. . .
Social expenditure to debt service3	1	1	1	2	. . .
Tanzania4
Social expenditure	288	289	327	361	379
Social expenditure/fiscal revenue (in percent) 2	29	30	31	30	29
Social expenditure to debt service3	1	1	2	3	3
Uganda4
Social expenditure	261	306	349	400	. . .
Social expenditure/fiscal revenue (in percent) 2	37	40	39	39	. . .
Social expenditure to debt service3	2	3	7	8	. . .
Source: Country authorities; and IMF and World Bank staff estimates. 1In addition to health and education spending, social expenditures include new programs to be financed partly by HIPC Initiative assistance in Benin, basic sanitary infrastructure in Bolivia, rural development and water supply in Burkina Faso, social safety net and rural development programs in Honduras, current expenditures on health and educatin only in the case of Mozambique, poverty reduction programs in Mauritania, other spending including promotion of women (both current and capital components) in Senegal, and water supply in both Tanzania and Uganda. Local currency figures are converted into U.S. dollars using relevant period average exchange rates. 2Fiscal revenue excluding grants. 3Ratios for 1998 and 1999 are social expenditure to debt service paid; ratios for 2000 onward are social expenditure to debt service due after enhanced HIPC Initiative assistance. 4On fiscal year basis, i.e. 2000 column shows FY 2000/01. 5There is little information in the Decision Point document except expenditure financed by debt relief under the Enhanced HIPC Initiative. Data compiled by the IMF and World Bank staff at the time of the Decision Point are used.