Projections indicate that most HIPCs are likely to run negative resource balances for many years to come and will continue to need financing on concessional terms. It concludes that while the lower debt service levels resulting from enhanced HIPC debt relief will provide a safety margin in the event of shortfalls in export revenues for these countries, the room for a significant deterioration without impacting long-term debt sustainability and poverty reduction is limited. The posting also includes, at the end, a table of dependence on major exports for HIPC countries, presented in the World Bank study. Even within the restricted terms of debate within the international financial institutions themselves, the case for further debt reduction is irrefutable. When one adds in the broader context of the debt, outside a narrow financial accounting, it is clear that the balance of debt is from North to South rather than the reverse.
More debt reduction is needed, but it is far from enough.
There are many other prerequisites for reaching such a target and spending it effectively - including local political will, civil society pressure, additional international funding, and effective administration. But stopping the drain of debt payments to the rich international financial institutions is fundamental. And the need is for immediate action. The spring meetings of the World Bank and the IMF saw no such action. The next test will be the Genoa meeting in July of the G-7 rich countries.