IMF, World Bank announce $2b debt relief for Guinea

WASHINGTON - The International Monetary Fund (IMF) and the World Bank's International Development Association (IDA) have decided to support about $2.1 billion in debt relief for Guinea, the IMF announced here on Wednesday.

The plan amounted to a 66-percent reduction of the West African country's external debt, the IMF said in a statement.

The Boards of Directors of both institutions determined that Guinea has made satisfactory economic and social reform progress in meeting the requirements to reach the completion point under the Heavily Indebted Poor Countries (HIPC) Initiative.

"Reaching the HIPC completion point represents an important achievement for Guinea. It reflects the significant progress made in economic management following the first democratic elections in December 2010," said Harry Snoek, the IMF mission chief for Guinea.

"Reaching the completion point will help Guinea allocate more resources for poverty reduction and economic growth. Sound macroeconomic management will remain critical after the completion point to make the most of Guinea's abundant mining resources and other growth potentials," Snoek added.

Of the scheduled reduction of about $2.1 billion, about 70 percent will come from multilateral creditors including the World Bank and the African Development Bank, and the remaining from bilateral and commercial creditors.

The HIPC Initiative was launched by the World Bank and the IMF in 1996 as a comprehensive effort to help the world's poorest, most heavily-indebted countries. It was enhanced in 1999 to provide for faster, deeper and broader debt relief.