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Obtains major debt relief from the ADB
Tunis, 26 July 2006 –The Boards of Directors of the African Development Bank (ADB) and the African Development Fund (ADF) today agreed that Cameroon had effectively met the conditions and reached the completion point under the enhanced framework of the Heavily Indebted Poor Countries (HIPC) Initiative.
The Bank Group’s share of debt relief will amount to US$ 78.84 million in end-1999 Net Present Value terms (US$ 100.51 million in nominal terms), which is equivalent to about 24.5 percent of the multilateral creditors’ assistance.
Reaching completion point debt relief under the enhanced HIPC Initiative, qualified Cameroon for additional debt cancellation from IMF, World Bank (IDA) and the ADF under the Multilateral Debt Relief Initiative (MDRI). The total debt relief benefits for Cameroon from the ADF under the MDRI is estimated at US$ 229.04 million over the approximately 50 year period of the Initiative, from 2006 – 2054.
Cameroon qualified for HIPC debt relief after having demonstrated good progress in stabilizing its economy and continuously implementing sound policies for macro economic and financial stability, growth and poverty reduction.
To reach completion point, the government had to fulfill three key conditions:
- Preparation of a full Poverty Reduction Strategy Paper and satisfactory implementation for at least one year;
- Maintenance of a stable macroeconomic environment;
- Satisfactory use of the budgetary savings from the interim debt service relief;
- Satisfactory implementation and conclusion of structural reforms supported by the Third Structural Adjustment Credit;
- Satisfactory implementation of governance and anticorruption measures, including in the areas of judicial and procurement reforms, budget execution, and the creation of regulatory agencies;
- Satisfactory implementation of key social reforms, including combating HIV/AIDS.
The Boards of the ADB and ADF noted that although fiscal slippages occurred prior to 2005, Cameroon has met most of the triggers that were set at the decision point to monitor its progress in meeting the completion point conditions under the enhanced HIPC framework. They encouraged the country to continue implementing reforms and fighting corruption.
Cameroon is the 15th Regional Member Country of the African Development Bank to reach completion point under the enhanced HIPC Initiative.