Britain To Write Off Third World Debt

July 7, 2008 - 8:07 PM

London (CNSNews.com) - Britain will write off billions of pounds in debt owed by 41 of the world's poorest nations and hopes other industrialized countries will follow suit, its finance minister announced on Tuesday.

Chancellor Gordon Brown warned that countries which did not use the money to relieve poverty by means of monitored poverty reduction plans would be disqualified from the offer.

"It is important to establish that the debt relief does not go to military expenditure or to luxury prestige projects or to waste and bureaucracy, and it actually goes to helping the poorest people in the world," he told a government seminar in London.

Twenty-five countries - with Mozambique, Mauritania, Bolivia and Uganda topping the list - should benefit from the decision by the end of next year.

"For too long, these countries have been weighed down by the shackles of an unsustainable debt burden," Brown said. "I want these countries to go into the new millennium free from these shackles and able to invest for the good of their people in health and education."

The government's decision will cost each British citizen about $19 in taxes over a three-year period.

The Jubilee 2000 coalition that campaigns for debt relief welcomed Brown's "magnanimous gesture," but warned that much more needed to be done.

"On the eve of the new millennium, Gordon Brown has responded to the voices of millions of Jubilee 2000 campaigners," director Ann Pettifor said in a statement. "He must continue to show leadership in the face of resistance from other
G7 leaders," she added.

Pettifor said the sum Britain would write off "isn't a great deal of money, but it is politically very important because Canada has already committed to writing off its debt, and so has President Clinton on behalf of the United States, now Britain. We need to persuade Japan, and France and Germany to do the same and then it will start to make a real difference to those poor countries," she said.

Oxfam's policy director, Justin Forsyth, said Britain had "shown the way" but expressed concerns that "some countries like Japan and Germany" were dragging their heels. "We need to keep the momentum up."

Last year, the world's richest nations agreed to write off close to $100 billion in debt owed by developing countries. In September, Clinton announced he would cancel 100 per cent of debts owed to the U.S.

Jubilee 2000 says 19,000 children are dying every day because of Third World debt burden.