For low-income countries excessive debt burdens can be a deterrent to economic prosperity. One the one hand, additional financing directed at the right policies and programs can boost a country’s ability to achieve its development goals. On the other hand, too much borrowing can exacerbate debt problems and can thereby be counter-productive to development goals.

This became increasingly apparent in the case of many low income countries in the mid 1990’s. Rising debt burdens in these countries sparked an international advocacy campaign popularly known as the Jubilee Movement to forgive debts of the world's most indebted countries. This campaign led to the launch of the Heavily Indebted Poor Countries (HIPC) Initiative in 1996--a multilateral debt relief initiative. As of August 2005, 38 countries, 32 of them in Sub-Saharan Africa, potentially qualify for HIPC assistance. Of these, 28 countries are receiving debt relief. This summer G-8 leaders made a pledge for complete debt cancellation for these nations.

This seminar will examine the origins and dimensions of debt relief initiatives, the key forces behind these debt relief initiatives and the factors that influence long-term debt sustainability and economic growth.