Economic Prospects, Long Term Debt Sustainability and the Role of Investment

image of HIPCs
This paper provides a review of the economic prospects for HIPCs in the global context. Two issues in particular are discussed. First, the paper emphasises the importance of promoting export orientated investment that upgrades and sustains exports.

Second, it underlies the need to promote private participation in infrastructure. The paper was commissioned by the Commonwealth Secretariat as an input into the Commonwealth HIPC Ministerial Forum in March 2004, which was held in Freetown, Sierra Leone. It also includes the Ministerial Statement, which is attached as an Annex to the paper.



Executive Summary

The number of countries which have reached decision point under the HIPC Initiative remains at 27, of which 14 have reached completion point, with Ethiopia, Ghana and Senegal as the most recent additions. The process of reaching completion point has generally taken longer than envisaged for three reasons: the time taken to prepare a full Poverty Reduction Strategy Paper (PRSP) and its satisfactorily implementation for at least one year; the delay in implementing the Poverty Reduction and Growth Facility (PRGF) programmes; and the need to satisfy social and structural triggers. The first reason is now mainly of historical significance as 12 of the 16 Interim HIPCs have actually completed their PRSPs, eight of which have already been implementing them for more than one year.


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