Press Release: IMF to Extend 100 Percent Debt Relief to Guyana Under the Multilateral Debt Relief Initiative
December 23, 2005
"Under the Multilateral Debt Relief Initiative, the IMF Executive Board has approved debt relief for Guyana (see Press Release No 05/286). As part of the Initiative, the IMF will provide 100 percent debt relief on all debt incurred by Guyana to the IMF before January 1, 2005 that remains outstanding. This amounts to approximately US$65 million, or US$45 million excluding remaining assistance under the Heavily Indebted Poor Country (HIPC) Initiative. This debt relief should become available in early January as soon as the remaining consents of the contributors to the PRGF Trust Subsidy Account have been received. The international community has made these additional resources available to help Guyana make progress toward its Millennium Development Goals (MDGs).
"Guyana has qualified for IMF debt relief because of its overall satisfactory recent macroeconomic performance, progress in poverty reduction, and improvements in public expenditure management. In particular, since reaching the completion point under the enhanced HIPC Initiative, Guyana has maintained macroeconomic stability in the face of an adverse external environment. Although achieving high growth has been a challenge, inflation has been kept low, the exchange rate has remained stable, and external reserves have been kept above three months of imports. Regarding its poverty reduction strategy, of the 24 goals, 17 were attained or exceeded. While there is a critical need to improve and update the data needed for detailed assessment of poverty trends, the amount of pro-poor spending in the budget has reached just over 17 percent of total outlays in 2004, exceeding the HIPC target by 2.4 percentage points. Performance in these areas will ensure that resources made available under the Multilateral Debt Relief Initiative will be used effectively.
"The IMF looks forward to working with Guyana to help it develop a strong and stable economy and to make sustained progress toward the MDGs," he said.