Multilateral Debt Relief Initiative (MDRI)

The MDRI provides additional debt relief under the enhanced HIPC Initiative to eligible RMCs that have reached their completion points. Under the MDRI, donors are committed to cancel ADF loans for debts outstanding and disbursed, effective from the cut-off point (end-December 2004), and to compensate the Bank “dollar for dollar” for the MDRI-related foregone reflows over a 50-year period to safeguard the long-term financing capacity of the ADF. The estimated cost of the MDRI is UA 5.6 billion (US$ 8.8 billion).

Since September 2006, the effectiveness date of MDRI, the Boards of Directors have approved HIPC debt relief for the 20 completion point RMCs. The total debt cancelled as of End-March 2009 is estimated at US$7.0 billion, in nominal terms. With the cancellation of debt under MDRI , the overall debt relief and cancelled committed by the Bank Group is US$12.5 billion. Out of this, 75 percent (US$9.4 billion) have already been delivered to the beneficiary countries under MDRI (US$7.0 billion) and HIPC (US$2.4 billion). Completing the implementation of these initiatives will require sustained efforts from the international community including the Bank Group (See Chart 3 for the total debt relief committed and delivered under the two Initiatives).

1. Countries that have qualified for irrevocable debt relief under the HIPC Initiative and have received MDRI relief.