Press Release

No: 165/1999
Date: 22 September 1999

The major industrial countries must give more to debt relief

- If we are to find a lasting solution for the heavily indebted poor countries, each of the major industrial countries will have to be prepared to commit their share of the financing, says Minister of International Development and Human Rights Hilde Frafjord Johnson.

On 21 September, the Minister sent a letter on behalf of the Nordic and Baltic countries together with the Netherlands and Switzerland to the governments of the G7 countries, urging them to increase their contribution to the HIPC debt relief initiative established by the World Bank and the International Monetary Fund. The Nordic countries, the Netherlands and Switzerland have so far financed 75 per cent of the World Bank's HIPC Trust Fund. The HIPC initiative will be one of the central issues for debate during the World Bank annual meetings in Washington at the end of September.

At their summit in Cologne this summer, the major industrial countries proposed a number of positive steps that could be taken to strengthen the HIPC initiative. Their reform proposals will involve a doubling of the costs of the initiative and negotiations are currently in progress to determine how these reforms can be implemented. However, funding to cover the costs has not yet been secured. Norway has joined forces with like-minded countries to increase pressure on the other creditor countries to contribute their share.

· The proposals from the G7 meeting will make a considerable improvement to the HIPC, says Frafjord Johnson. This initiative has our full support and the proposals are in full agreement with several of our own proposals presented in the Norwegian debt relief strategy last year. However, nothing can be achieved without funding. Norway is willing to increase its contribution, but this will not be enough unless the large industrial countries also increase theirs.

Royal Ministry of Foreign Affairs, 22 September 1999