WHILE some may contend that debt relief is not important, the truth of the matter is, fulfilling the criteria for debt relief is no easy task and debt relief paves the way for development.

Once a country is heavily indebted then there will be a stagnation of growth and poverty reduction. Debt burden makes escaping poverty impossible, but through the Heavily Indebted Poor Country (HIPC) Initiative, Guyana was able to escape and prevent the unsustainable debt burdens which hinder economic growth and development in developing countries.

Those who curse debt relief should know that heavily indebted poor countries have limited access to international markets and debt burden only makes it difficult to repay loans. This will deter other prospective lenders and investors from Guyana. In addition, debt burden dampens governmental efforts to make structural and fiscal reforms which would enhance economic growth and benefit its fiscal position in the world.

Many people come short of the realization of the ‘true meaning’ of debt relief. Debt relief is not automatic and it is not attained overnight. It involves sustained policy and institutional improvements to promote sustained growth and accelerated poverty reduction and involves years of strategic planning and commitment. These modifications must be in line with the United Nations Millennium Development Goals (MDGs) and the Multilateral Debt Relief Initiative (MDRI).

Further, to achieve debt relief, countries must establish a good track record of good performance under the International Monetary Fund (IMF)-and International Development Association (IDA)-supported programs, implement key reforms, and implement the Poverty Reduction Strategy Paper (PRSP) for one year.

Even though Government managed to achieve an enormous amount of debt relief, the need for borrowing loans will persist. The achievement of debt relief will benefit developing countries since it left them at a position where they are at low levels of debt, and makes it easier for securing additional borrowing which is necessary to continue growth. These new additional capital acquired through new loans will augment the productive capability of developing countries.

Today, funds that were once used for the repayment of debt are now steered towards expenditures on health, education and other social sectors that were once ignored in the past, for the benefit of the ordinary people.

Today, Government continues to strengthen policies and institutions and collaborate with the international community to sustain economic growth and development in Guyana.
ELIZABETH DALY