The HIPC Debt Relief Initiative: Uganda's Experience

debt relief, debt sustainability, net present value (NPV) of debt, non-OECD creditors, debt ratios, PAPSCA, PEAP, PRSP, PAF

Strengthening governance through engaged societies : lessons from the implementation of poverty reduction strategies

In December 1999, the Boards of the World Bank and the International Monetary Fund approved a new approach to their relations with low-income countries. The approach was centered around the development and implementation of Poverty Reduction Strategies (PRS), which are intended to be country-driven and medium- to long-term in perspective, comprehensive and results-oriented, partnership-oriented, and built on broad-based participation. Against this tall order of business, experience to date has been varied, and much debate is ongoing on whether the approach can be considered more than"old wine in new bottles."This paper-based on the results of a thorough review of the five-year implementation experience-examines the implementation of the PRS approach from the point of view of participation and accountability. For some 50 countries adopting the approach since 1999, it discusses the factors which can facilitate the development of accountability and participatory governance mechanisms. Lessons learned from distinct country circumstances are analyzed, arguing that ownership of the PRS depends on the way countries and their external donor partners handle real tensions in the relationship between country ownership on the one hand, and perceptions of internationally-driven prescriptions on the other. The central message of the paper is that in several countries the PRS initiative has helped open up societies to forms of dialogue and contestability not previously experienced in-country or observed by external partners. This positive outcome, however, has been largely influenced by the extent to which the PRS process has reinforced existing trends and strengthened institutions already prone to open discussion of policy choices. The paper also shows that even in the best cases change has, to date, been largely in the area of process and that impact of participatory governance on policymaking, while emerging, is still a work in progress. The paper concludes with recommendations for how developing country societies might sustain real achievements in participatory governance and domestic accountability going forward, with external partners playing a key supportive role through harmonization and alignment.Governance Indicators,Social Accountability,Poverty Monitoring&Analysis,Achieving Shared Growth,Rural Poverty Reduction

Proceedings of the African Diaspora Conference on Sustainable Development

The authors urge the Western donor organizations to facilitate and support the take up of such more sustainable models

The Millenium Development Goals and Sovereign Debt Write-downs

Can sovereign debt write-downs be used to achieve the Millennium Development Goals (MDGs)? This paper shows that transparency of domestic governance determines how a sovereign debt write-down is structured to attain the MDGs. When domestic governance is transparent, an unconditional debt write-down enhances non-elites’ welfare. Without such transparency, conditions that directly link the debt write-down to public goods that improve non-elites’ welfare are required. In the latter case, in a dynamic setting, the debt write-down also has to be directly linked to the amount of new debt issued. Using our formal analysis, we evaluate the efficacy of the current debt relief initiatives and discuss some policy implications.Debt Write-down, Representativeness, Transparency, Conditionality, Millennium Development Goals.

The HIPC Initiative and Poverty Reduction in Ghana: An Assessment

Debt , Poverty reduction, Government expenditure

Making Debt Relief Conditionality Pro-Poor

Aid conditionality, HIPC, Debt relief, East Africa

BURDEN SHARING AT THE IMF

In the context of the financial governance of the International Monetary Fund, what are the equity implications of the way in which the IMF distributes the cost of running its regular (non-concessionary) lending operations as well as how it funds its concessionary lending and debt relief operations? While the IMF charges borrowers roughly what it pays its creditor members for the resources used in its regular lending operations, its overhead costs (administrative budget plus addition to reserves) are shared between the two groups of members in a less equitable manner. With overhead costs rising inexorably to meet the increasing number and range of responsibilities being placed on the institution – largely at the instance of the IMF‘s principal creditors by virtue of their dominant majority of voting power – the under-representation of the IMF’s debtors undermines the legitimacy of its decision making. With regard to the concessionary lending and debt relief operations, some of the IMF’s funding modalities have involved a substantial contribution by IMF debtors, sometimes under pressure. While this has been accepted as part of an intra-developing-country burden-sharing exercise, it has also significantly reduced the cost to developed countries of meeting their responsibilities to the poorest members of the international community.

External debt sustainability and domestic debt in Heavily Indebted Poor Countries

In this paper we stress the limits of the current debt sustainability framework used in the IMF-WB HIPC Initiative and the necessity to include domestic public debt into the analysis. The standard sustainability analysis does not take into account the fully-fledged budget constraint and the feedback effects of the fiscal and monetary adjustment required by multilateral programs. The switch from foreign to domestic borrowing, and rising domestic real interest rates are likely to undermine the overall sustainability and the success of debt relief programs. This work focuses on the evaluation of public debt sustainability in a simple accounting framework. We use data on external public debt (multilateral and bilateral) and on domestic public debt to underline how the inclusion of domestic debt into the analysis undermines the sustainability target.HIPC; Domestic debt; Debt sustainability; Debt Relief