IMF assesses G8 debt proposal
| Pages | 201-203 |
Page 201
The G8's Gleneagles Summit reiterated the June proposal of G8 finance ministers to cancel the multilateral debt of the Heavily Indebted Poor Countries and added an initiative to sharply increase official development assistance for low-income countries. IMF staff are assessing the various policy, legal, and financial aspects of the G8 debt relief proposal relating to the Fund. This will provide the basis for a late July Executive Board discussion.
Page 203
IMF Managing Director Rodrigo de Rato lauded agreements reached at the Group of Eight (G8) Gleneagles Summit on July 8 to boost aid and cancel debt, terming them a "major contribution" to helping the poorest and most indebted countries make progress toward the Millennium Development Goals and ending poverty. The IMF, he said, is committed to playing its part in implementing the wide-ranging agreements on climate change, energy, and sustainable development. De Rato attended the summit with the heads of the United Nations, the World Bank, and the World Trade Organization (WTO), and leaders from 11 nations in Africa, Asia, and Latin America.
The leaders of the G8 economies-Canada, France, Germany, Italy, Japan, Russia, the United Kingdom, and the United States-reiterated the June G8 finance ministers' proposal for 100 percent cancellation of debt owed to the IMF,World Bank, and African Development Bank by participants in the Heavily Indebted Poor Countries (HIPC) Initiative. The effort has won widespread plaudits, but many important details and much of the logistics remain to be worked out.
De Rato said he looked forward to "detailed discussions by the IMF Executive Board in the weeks ahead."At the request of the Executive Board, IMF staff are preparing for its consideration a paper analysing the proposal and how it might be implemented.
The paper will examine the various policy, legal, and financial aspects of the proposal, including its implications for the IMF's role in low-income countries.
Among the specific issues to be looked at are the "uniformity of treatment" of member countries required by the IMF's founding Articles of Agreement and the implications of the proposal in that context.While "uniformity of treatment" does not mean identical treatment for all members, it does require any differentiation to be based on criteria relevant to the Fund's objectives in the...
To continue reading
Request your trial