Jim Flaherty, Minister of Finance, announced that the Government of Canada will forgive Haiti's debt through the Canadian Debt Initiative. To date, $965 million worth of debt owed by the world’s poorest and most heavily indebted countries has been forgiven.
Finance Minister in Chile
On July 2, 2009, Canada's Finance Minister, Jim Flaherty attended the meeting of the Committee of the Board of Governors of the Inter-American Development Bank in Santiago, Chile. The theme of this conference is “Hemispheric Responses to Global Economic Instability.”
The Republic of Haiti has become the thirteenth nation to meet all of the debt relief requirements of the Canadian Debt Intitiative. Finance Canada states that once all eligible countries have completed the process, $1.3 billion will be forgiven. The “Heavily Indebted Poor Countries Initiative” requires countries to cancel up to 90% of bilateral debts owing. The Canadian Debt Initiative provides 100% debt cancellation.
This decision will help free up valuable financial resources so that the Haitian government can better focus on priorities. “At a time of unprecedented hardship in the global economy, Canada continues to eliminate financial burdens faced by Haiti and other nations as they take the steps needed to strengthen their economies," said Finance Minister Flaherty.
Canadian Debt Initiative
Ten years ago, the Canadian Debt Initiative announced that eligible countries can receive a 100% debt service moratorium, followed by 100% debt cancellation after a period of demonstrated governance reform. Other bilateral creditors have followed Canada’s lead and they have implemented similar strategies.
Debt relief for Haiti will encourage this nation to make continued improvements in governance and aid in their economic stability.
In 1996, the international community created and later enhanced the “Heavily Indebted Poor Countries (HIPC) Initiative”. Canada played a leadership role to ensure all creditors would provide some debt relief to poor nations and that proceeds of this relief be directed to social priorities. This initiative was put in place by the World Bank and the International Monetary Fund. Today, Haiti joins over 30 countries who are benefiting from this and the Canadian initiative.
Other Announcements
Jim Flaherty made other announcements in Chile that include:
- $5 million in support for the International Monetary Fund's Technical Assistance Center for Central America, Panama, and the Dominican Republic. This was launched in Guatemala City on June 24 to promote regional economic growth and development.
- $200 million (US) to get life-saving vaccines into some of the world's poorest countries.
- $200 million (US) to the World Bank's Global Trade Liquidity Program to provide a further boost to world markets.
Canada's initiatives are helping thousands of people in the global community. Although there is much more to be done both worldwide and in Canada, at least the Canadian spirit of helping others is another reason for Canadians to proud.
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