Norway pledges NOK 25 million towards cancellation of Liberia’s debt

Norway will contribute up to NOK 25 million towards cancelling Liberia’s debt to foreign private creditors. The announcement was made by State Secretary Håkon A. Gulbrandsen on 26 June at the Liberia Poverty Reduction Forum in Berlin.

"The people of Liberia are paying a heavy price for old debts. We will contribute NOK 25 million to prevent Liberia’s debt to private creditors from hampering the country’s fight against poverty,” said Mr Gulbrandsen.

So-called vulture funds buy up the debts of the poorest and most heavily indebted countries and then sue the countries for the whole outstanding debt and the accrued interest. Norway is now helping to buy back and cancel NOK 8 billion worth of Liberia’s debt.

“The vulture funds are the scavengers of the financial world. They buy up developing countries’ debts cheaply and then collect the debts plus compound interest in order to fill the bank accounts of the rich. Norway is helping to eliminate these vulture funds,” said Mr Gulbrandsen.

At the Forum, Liberian President Ellen Johnson Sirleaf presented her new poverty reduction strategy. Norway is one of the main cooperation partners. In the space of one year, Liberia’s debt has been reduced by NOK 5 billion, but its remaining debt is still five times that amount.

Norway recently contributed NOK 110 million towards cancelling Liberia’s defaulted debt to international financial institutions.  The Government will also cancel 90% of Liberia’s debt to Norway this year.

Liberia’s has been through a 14-year-long civil war, which ended in 2003. It is one of the poorest countries in the world.

Read State Secretary Gulbrandsen’s statement at the Forum.

Press contact: Information Adviser Ragnhild H. Simenstad, mobile phone 917 17 459.