Thursday, January 21, 2010

World Bank waives Haiti's debt payments

Actually some good news today, we hope that there is more to come on this issue.

The World Bank issued a statement saying that they waive all payments on Haiti's debt for the next five years. The Bank points out they only represent 4 percent of all of Haiti's external debt, so many more lenders and countries will need to follow suit.

From the World Bank's press release comes details of the debt forgiveness.

The World Bank fully supports debt relief for Haiti. In June 2009, the World Bank, along with the IMF and other donors, granted Haiti $1.2 billion in debt relief through the Heavily Indebted Poor Countries initiative and the Multilateral Debt Relief Initiative. Since 2005, the World Bank’s financial support for Haiti ($363 million) has been carried out through grants. This does not include the $100 million in grants announced on January 13, 2010, in response to the earthquake.

Currently, Haiti's debt to the World Bank, which is interest-free, is about $38 million—about 4% of Haiti’s total external debt. Due to the crisis caused by the earthquake, we are waiving any payments on this debt for the next five years and at the same time we are working to find a way forward to cancel the remaining debt.

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