Vol. 557 No. 1
201 Mr. Ring asked the Minister for Finance his views on new Irish debt policy; the reason he did not communicate the new debt policy to the IMF and World Bank; the action he will take to ensure that these bodies are made aware of Ireland's debt policy; if he will instruct Ireland's representatives to the IMF and World Bank to promote Irish debt policy vigorously. [21497/02]
I wish to draw the Deputy's attention to replies to recent questions on this matter from Deputy McGuinness on 24 October 2002 – Parliamentary Question No. 58 – and Deputy Richard Bruton on 15 October 2002 – Parliamentary Question No. 192.
Ireland's debt strategy for developing countries was launched publicly last July. The debt strategy document, prepared jointly by Ireland Aid and the Department of Finance, was forwarded to Ireland's representatives at the IMF and the World Bank in advance of the recent annual meetings of these institutions. Both executive boards are fully aware of Ireland's policy on developing country debt.
I remind Deputies of the Government position in relation to debt cancellation as stated in the debt strategy document. We have concluded that, in principle, the total cancellation of the debts of the heavily indebted poor countries is a politically acceptable objective and one that we would support. Total cancellation would, however, have to be funded largely through additional donor contributions. In order to mobilise the necessary funds for total debt cancellation, a greater number of donors, particularly the larger economies, would have to increase their ODA more rapidly and take concrete steps to meeting the UN target of 0.7% of GNP on ODA.
The total cancellation of HIPC debts should be accompanied by strong monitoring and accountability mechanisms to ensure that the additional funds available to HIPC governments, through debt cancellation, would be directly channelled into increased social expenditure, particularly HIV-AIDS.
While we support, in principle, the total cancellation of HIPC country debts we believe that, in practice, the additional donor contributions required to achieve this will be difficult to mobilise. The additional ODA commitments made by major donors – EU and US – at the International Conference on Financing for Development would not be sufficient to cover total debt cancellation. In any case, these contributions will be used to fund a number of development activities and not just debt relief.
