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G8 Summit

Volume 404: debated on Thursday 8 May 2003

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15.

If he will urge the forthcoming G8 summit to tackle the shortfall in the HIPC trust fund. [111896]

At the forthcoming G8 summit, we will push for a change in the HIPC rules to exclude additional voluntary bilateral debt relief from the calculation of topping up at completion point. The aim of that measure is to provide an estimated $1 billion extra debt relief to low-income countries.

I congratulate my right hon. Friend, in particular, on his efforts to promote the international finance facility. I wish him every success in promoting that initiative at the forthcoming G8 summit, and I hope that he can persuade other members of the G8 to join it. Does my right hon. Friend agree that an urgent need exists to review the HIPC scheme and to adopt an approach whereby it should be based on the country's ability to meet its basic needs rather than putting priority on debt reservicing?

I thank my hon. Friend for the work that she does in promoting the case of debt relief and the international finance facility. It is absolutely true that the HIPC initiative achieves many but not all our aims. Twenty-six countries are receiving debt relief, and another nine could qualify. The long-term solution to the problems that she identifies—both debt and poverty—is a major initiative for a funding mechanism that could double the amount of aid available. That is why we are supporting the international finance facility, and I am pleased that there is all-party support for that.