The UK is to pay off 10 percent of the money owed by the world's poorest countries to the World Bank and the African Development Bank in an attempt to free them from "the shackles of debt", British Finance Minister Gordon Brown was to announce today.
Brown's announcement will come on the eve of the UK's ruling Labour Party's annual conference in Brighton that the UK's international development agency will earmark at least ?100 million a year to meet the interest payments and principal owed by over 30 nations.
Alarmed that previous initiatives on debt relief have failed to provide a lasting solution to the problem, Brown will challenge other rich countries to follow Britain's lead when he attends the annual meeting of the World Bank and International Monetary Fund in Washington next week.
The aid agency Oxfam said if the rest of the Group of Seven leading industrial nations followed suit, there would be six million fewer child deaths each year, 45 million more children could attend school and clean water could be provided for 140 million people.
Under Brown's proposal, 14 countries that have qualified for debt relief under the heavily indebted poor countries initiative and 18 low-income countries that are not part of the scheme -- such as Afghanistan, Cambodia and Tonga -- would be entitled to financial help from Britain.
The countries owe money to multilateral institutions, primarily the IMF, the World Bank or the African Development Bank. Brown says the slice of debt owed to the IMF should be paid off by revaluing the Fund's stock of gold in an off-market transaction that he says would have no impact on the global price of the metal.
The IMF's gold is valued at around US$50 an ounce, against a market price of just over US$400 an ounce.
"Because we cannot bury the hopes of half of humanity in the lifeless vaults of gold, the cancellation of debt owed to the IMF should be paid for by better use of IMF gold," Brown's prepared remarks for the meeting of the Trade Justice Movement tomorrow read.
Brown was to say that in the absence of an international agreement, Britain will act unilaterally to offer poor countries help with their debts to the two development banks.
The Treasury said the UK's share of this debt amounted to around 7 percent to 8 percent of the total, but the (British) government was prepared to fund a 10 percent write-off.
Hilary Benn, the UK's international development secretary, said "This throws down a challenge to the rest of the world."
BOMBARDMENT: Moscow sent more than 440 drones and 32 missiles, Volodymyr Zelenskiy said, in ‘one of the most terrifying strikes’ on the capital in recent months A nighttime Russian missile and drone bombardment of Ukraine killed at least 15 people and injured 116 while they slept in their homes, local officials said yesterday, with the main barrage centering on the capital, Kyiv. Kyiv City Military Administration head Tymur Tkachenko said 14 people were killed and 99 were injured as explosions echoed across the city for hours during the night. The bombardment demolished a nine-story residential building, destroying dozens of apartments. Emergency workers were at the scene to rescue people from under the rubble. Russia flung more than 440 drones and 32 missiles at Ukraine, Ukrainian President Volodymyr Zelenskiy
COMPETITION: The US and Russia make up about 90 percent of the world stockpile and are adding new versions, while China’s nuclear force is steadily rising, SIPRI said Most of the world’s nuclear-armed states continued to modernize their arsenals last year, setting the stage for a new nuclear arms race, the Stockholm International Peace Research Institute (SIPRI) said yesterday. Nuclear powers including the US and Russia — which account for about 90 percent of the world’s stockpile — had spent time last year “upgrading existing weapons and adding newer versions,” researchers said. Since the end of the Cold War, old warheads have generally been dismantled quicker than new ones have been deployed, resulting in a decrease in the overall number of warheads. However, SIPRI said that the trend was likely
‘SHORTSIGHTED’: Using aid as leverage is punitive, would not be regarded well among Pacific Island nations and would further open the door for China, an academic said New Zealand has suspended millions of dollars in budget funding to the Cook Islands, it said yesterday, as the relationship between the two constitutionally linked countries continues to deteriorate amid the island group’s deepening ties with China. A spokesperson for New Zealand Minister of Foreign Affairs Winston Peters said in a statement that New Zealand early this month decided to suspend payment of NZ$18.2 million (US$11 million) in core sector support funding for this year and next year as it “relies on a high trust bilateral relationship.” New Zealand and Australia have become increasingly cautious about China’s growing presence in the Pacific
Indonesia’s Mount Lewotobi Laki-Laki yesterday erupted again with giant ash and smoke plumes after forcing evacuations of villages and flight cancelations, including to and from the resort island of Bali. Several eruptions sent ash up to 5km into the sky on Tuesday evening to yesterday afternoon. An eruption on Tuesday afternoon sent thick, gray clouds 10km into the sky that expanded into a mushroom-shaped ash cloud visible as much as 150km kilometers away. The eruption alert was raised on Tuesday to the highest level and the danger zone where people are recommended to leave was expanded to 8km from the crater. Officers also