|What did the G8 Finance Ministers agree last Saturday on Third World Debt?
16 Jun 2005
First, we agreed on a proposal to cancel multilateral debt of the poorest countries and thus complete the process of 100 per cent debt write off. 18 countries will benefit almost immediately with $40 billion of debt written off. Another 9 countries should benefit within 12-18 months. Another 11 countries will have the opportunity to benefit when they reach completion point for the Heavily Indebted Poor Countries (HIPC). Each country agreed to make the additional sums of money available to cover fully World Bank and African Development Bank debts. At the same time we agreed a financing system for IMF debts to be cancelled too. Britain will continue to make its debt offer directly to an additional 28 of the poorest countries that are not in the HIPC Initiative.
Second, we brought together existing commitments to increase aid. Taken together this will generate an annual addition of $43 billion by 2010. Since the EU agreement to increase aid last month, Germany and Italy have affirmed their commitment to give 0.7 per cent of their gross national income as overseas development aid by 2015. They joined Britain, France, Ireland, Finland, Spain and Belgium, all of whom in the last three years have committed to a firm timetable to spend 0.7 per cent of their Gross National Income as aid. Finance Ministers have committed to increase the effectiveness of aid by focusing it on poverty reduction. I believe that out of the additional $43 billion already pledged for 2010, we can now deliver on the Commission for Africa recommendation that aid to Africa- should increase by $25 billion by 2010.
Third, Finance Ministers discussed funding increased efforts to treat and cure Malaria, TB and HIV/AIDS. For the first time, the G8 have committed themselves to provide universal access to AIDS treatment by 201Q For the first time also, Finance Ministers have promised to scale up support for co-ordinated international research on AIDS, TB and Malaria. The G8, in partnership with the World Bank, pharmaceutical industry and other governments and institutions, has committed to press ahead with work on Advance Purchase Commitments for vaccines for malaria, HIV/AIDS and other diseases of poverty, to incentivise private sector research, with the aim of considering concrete proposals by the end of this year.
Fourth, on Saturday for the first time G8 Finance Ministers agreed to demand, in Hong Kong later this year, a timetable to get rid of the protectionist export subsidies in agriculture. We promised funds to assist those most at risk and build poor countries' capacity to trade. We promised to help those most vulnerable to the move to more open markets, and we recognised for the first time that developing countries need the flexibility to decide, plan and sequence trade reforms in line with their own country owned poverty reduction programmes.
Finally, it was agreed we should continue work on the IFF and the IFF for Immunisation. The IFF now has growing support. The IFF for vaccination would be a partnership between countries and the Gates Foundation, frontloading $4 billion of extra funds for immunisation. It is estimated that between now and 2015 this one change could save 5 million lives.