Sun, Jun 12, 2005 - Page 11 News List

UK touts debt relief at G8 summit

POVERTY Although the British finance minister was keen on `the biggest debt settlement the world has ever seen,' other participants held more muted views


As finance ministers from the world's richest countries gathered in London on Friday, British Chancellor of the Exchequer Gordon Brown said he believed they could make progress toward "the biggest debt settlement the world has ever seen," a plan to erase billions of dollars owed by the world's poorest countries to international lenders.

But other participants at the gathering adopted a more muted view, hinting that some nations may still need to be won over before endorsing the landmark formula for debt relief that the US and UK agreed on this week. In Washington, the White House officially announced the agreement on Friday.

Treasury Secretary John Snow of the US and Brown are among the finance chiefs from the Group of Eight industrialized nations meeting for two days in London in advance of next month's Group of Eight summit meeting in Scotland.

"Much is still to be done, but I think there is a will to do this," Brown said Friday in a radio interview, referring to the plan to free 18 nations, most of them in Africa, from obligations to repay an estimated US$16.7 billion in debt to foreign lenders.

As this year's head of the Group of Eight, British Prime Minister Tony Blair has put the effort to relieve Africa's poverty and ease its debt burden at the head of an agenda that includes curbing global warming.

A breakthrough on the debt issue would enhance his position as he prepares for what is likely to be a contentious summit meeting at a time of deepening strains between the UK and its EU partners.

But it was not clear whether all Group of Eight members accepted the debt-relief plan. Besides the US and UK, the members are France, Germany, Italy, Canada, Japan and Russia.

Arriving in London, for instance, Caio Koch-Weser, Germany's deputy finance minister, said: "I can only say we are working on it."

Romilly Greenhill, a policy specialist with ActionAid International, an advocacy group based in South Africa, said the agreement had not yet won universal approval.

"France, Germany and to a lesser extent Japan are holding back," Greenhill said, because of concerns about the cost of compensating the lenders for the assets they would have to write off. Initially, she said, those countries had favored extending more limited debt relief to only the five poorest countries.

"It's by no means 100 percent certain" that the talks here will produce an agreement, she said. Additionally, the Group of Eight may wish to wait until it meets to announce an agreement with greater fanfare, she said.

This story has been viewed 3447 times.

Comments will be moderated. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned.

TOP top