Debt Relief

The international movement to "drop the debt" dates back to the 1980s when Mexico threatened to default on its skyrocketing debt. With an opportunity to address the growing debt crisis, world leaders and financial institutions did little more than refinance and reschedule the debt. In most cases, these "solutions" were tied to structural adjustment programs that forced impoverished countries to cut vital human services out of their governments' budgets in order to comply with the repayment schedules.

Over the next decade and a half, a growing movement of local groups, churches, development experts, and national leaders put increasing pressure on international institutions to change. Finally, in 1996, the World Bank and the IMF launched the HIPC (Heavily Indebted Poor Countries) framework whose stated aim was to 'reduce the external debt of eligible countries as part of a strategy to achieve debt sustainability.' Unfortunately, HIPC did not go far enough in reducing the debt burden and the Drop the Debt movement reorganized under the Jubilee 2000 coalition. This coalition continues to operate actively in the UK and around the world, calling upon world leaders and international financial institutions to cancel the debt of the most impoverished countries.

Today, world leaders are again promising to address the issue of debt. UK Chancellor Gordon Brown has been actively lobbying G8 leaders to cancel the debt of the 41 countries who have qualified under the HIPC initiative. Unfortunately, his efforts have been met with more promises and little action.

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