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Debt-relief not needed for non-defaulter Bangladesh |
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September 29, 2000
Dhaka (UNB) - Being a “good borrower” and non-defaulter, Bangladesh didn’t apply for the ongoing HIPC initiative of the World Bank-IMF for debt relief. “Moreover, Bangladesh is not a heavily indebted country and poverty is gradually declining here,” a top official said yesterday (Thursday) at a press briefing at the Prime Minister’s office. Principal Secretary to the Prime Minister Dr SA Samad said Bangladesh would lose many other benefits including easy-term credit if it becomes a member of Heavily Indebted Poor Countries (HIPC) group. The HIPC initiative was designed to provide exceptional assistance to eligible countries following sound economic policies to help them reduce their external debt burden to sustainable level. Contradicting a press report on the issue, Dr Samad said debt level of Bangladesh is sustainable and it is not more than 15 billion US dollars. “We are a good borrower, we have excellent credit rating, and we never defaulted. So we don’t need to be a member of HIPC, which will cut other benefits,” he added. The countries included in the HIPC initiative will have to repay their debt quickly while they will be deprived of soft loans from different World Bank and IMF bodies. The HIPC countries are: Angola, Benin, Bolivia, Burkina Faso, Burundi, Cameroon, Central African Republic, Chad, Congo, Cote d’Ivoire, Democratic Republic of Congo, Ethiopia, Ghana, Guinea, Guinea-Bissau, Guyana, Honduras, Kenya, Lao PDR, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Myanmar, Nicaragua, Niger, Rwanda, Sao Tome and Principe, Senegal, Sierra Leone, Somalia, Sudan, Tanzania, Togo, Uganda, Vietnam, Yemen and Zambia. Clarifying Bangladesh’s position, Dr Samad said debt relief has been linked with poverty reduction and this creates tension between quick debt relief and comprehensive strategies. Besides, he said, preparing poverty reduction strategies shall take a lot of time. These conditionalities have overshadowed the prospects of HIPC initiative. He felt that overload of conditionalities should be avoided as HIPC initiative is not likely to provide a lasting exit from debt problems unless strong and sustained economic growth is ensured. Tackling growth and poverty effectively would be a much longer time process than debt relief, and would require additional measures, said the PM’s Principal Secretary. He said debt relief should be concurrently supplemented by sustained aid flow on concessional terms to reduce over burdening. Denying a press report that the position of Bangladesh was not rightly projected in the IMF-World Bank meeting in Prague, he said a very competent team is representing the country under the leadership of Finance Minister Shah AMS Kibria. “Our team is completely protecting the interests of the country in that meeting,” he asserted. Press Secretary to the Prime Minister Jawadul Karim was present at the press briefing. |