Debt Relief for Low-Income Countries and the HIPC Initiative
March 1, 1997
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Summary
The paper describes the debt burden of low-income countries and the traditional mechanisms that have been implemented by the international community to alleviate this burden. While these mechanisms are sufficient to reduce the external debts of many heavily indebted poor countries (HIPCs) to sustainable levels provided these countries implement sound economic policies, they are likely insufficient for a number of countries. To deal with these cases, the World Bank and the IMF have jointly proposed and implemented the HIPC Initiative. The paper describes this Initiative and suggests that it should enable HIPCs to exit from the debt rescheduling process.
Subject: Asset and liability management, Debt burden, Debt reduction, Debt relief, Debt service, External debt
Keywords: Debt burden, debt problem, Debt reduction, debt reduction option, Debt relief, Debt service, debt service due, debt-service difficulty, debt-service reduction, debt-service reduction option, debt-servicing difficulty, debtor country, External Debt, Heavily Indebted Poor Countries Initiative, HIPCs debt-management capacity, IBRD debt, IDA debt-reduction operation, net present value, NPV reduction, right, Sub-Saharan Africa, WP
Pages:
29
Volume:
1997
DOI:
Issue:
024
Series:
Working Paper No. 1997/024
Stock No:
WPIEA0241997
ISBN:
9781451844108
ISSN:
1018-5941
