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Dept for International Development

Answer

Mr. Gardiner: To ask the Secretary of State for International Development what consideration is given to levels of HIV infection when approving a country for Heavily Indebted Poor Country debt relief. [149426] Hilary Benn: The amount of debt relief a country receives under the Heavily Indebted Poor Countries (HIPC) Initiative is determined by its Debt Sustainability Analysis. A country's debt is compared with its export earnings and government revenue, and relief is provided either to bring the debt to export ratio down to 150 per cent., or the debt to government revenue ratio down to 250 per cent, whichever gives the greater amount of relief. This framework is straightforward and transparent. It also captures all of the factors that could affect a country's ability to service its debt, including levels of HIV infection, as these will affect the export and government revenue figures. Additional relief--or `topping up'--can also be provided at Completion Point, for those countries that, as a result of exogenous shocks, risk exiting the Initiative with debts above the HIPC sustainability threshold. Levels of HIV infection are also addressed directly through the development of Poverty Reduction Strategy Papers (PRSPs), which are a requirement for receiving HIPC debt relief. Governments in HIPC countries lead national processes to develop PRSPs. These strategies set out national priorities and include an estimate of the cost of reaching medium-term development targets. The planned use of HIPC debt relief, along with all other forms of assistance for addressing social problems, such as HIV/AIDS, are addressed in these strategies. For many HIPC countries, analysis of poverty trends in PRSPs shows HIV/AIDS is an important factor, and public action plans can be costed within national spending plans. In this way, savings made under the HIPC Initiative are channelled directly towards tackling this issue.

Secondary information

Type

Written question

Reference

416 c1399W; 149426

Session

2003-04

Subjects

Debts Developing countries Debts written off HIV/AIDS Heavily indebted poor countries initiative

Link

View this Written question on www.publications.parliament.uk