At least 60 countries are still in a debt crisis that is wrecking health and education systems. Many of these debts come from loans made to dictators during the Cold War, and have never benefited poor people.
To get relief, countries have to meet IMF and World Bank conditions. Niger, for example, only got debt relief because it opened up its economy to global competition. The result of this was that its economy shrank, the government received lass money from taxes, and was unable to meet the needs of its own people. This has been a contributing factor to the current famine.
The G8 proposed a deal that wipe out almost half of the debts owed by some of the world's poorest countris. But it also said that countries that get debt reliefshould get less aid money - so the net benefit is quite low.
The debt deal will also only be open to countries that have already met the debt-relief conditions: only 18 countries will be eligible in the short term.
The deal has not yet been implemented - it may not even come into effect until June 2006! In the meantime, there are signs that some want to waterdown the commitments made at Gleneagles. The principle behind the deal is very important, though: for the first time, the G8 accepted that 100% debt cancellation is needed if countriesare to meet the Millennium Development Goals. MAKEPOVERTYHISTORY is now pushing for the strings attached to debt relief to be cut.
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