Debt Cancellation

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  • Topic: Poverty, Debt relief, Debt
  • Pages : 2 (434 words )
  • Download(s) : 277
  • Published : May 2, 2012
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The main idea behind debt cancellation is to use the money released to benefit to the people.Thanks to debt relief provided by the World Bank and other creditors, very poor and indebted countries are improving the lives of their people. Instead of paying billions of dollars in debt service, now over 35 countries around the world are spending more on health, education and infrastructure, contributing to economic growth and poverty reduction (WorldPress, 2011). From a social perspective the question is : What’s the human impact that debt relief is having in these countries ? In 10 African countries that have received debt relief, there has been a 40% increase on education spending and a 70% increase on healthcare expenditure. In Mali, since their debt relief, health spending has increased by 64% and education spending by 94% (Georgina Calle, 2011). According to Global Issues, on a local level, the difference it is making to individual people is tangible. For instance, in Uganda, new schools have been built, and primary education is now free. Additionally, Uganda’s rural transportation budget has doubled and they have markedly improved roads network, now farmers can bring their products directly to the markets which generates more incomes and improve the wealth of the people. In Zambia, debt cancellation has lead to completely free health care for millions of people and in Mozambique, there are more health clinics, nurses and better drugs supplies for them to work with (Oxfam, 2011). However, these few examples of success are not recurrent and debt cancellation does not work out for every country. One of the main reason is corruption. The funds freed up by debt relief are kept by corrupt governments. The redistribution is not fair, and it does not benefit to their population. It does not not increase the living standards in any way and poverty still remain strong.

WordPress (2011) - To what extent would debt relief reduce poverty ?. Available at :...
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