Italy Cancels $14.1m Debt Owed By Ghana

Italy has given a total debt relief of $14.1 million owed her by Ghana.Once Ghana reaches the completion point of the Heavily Indebted Poor Countries (HIPC) initiative in June, this year, the Government of Italy will be ready to cancel the outstanding stock of about $26.6 million.

An agreement to this effect was signed by Ghana?s Minister of State for Finance, Dr Nii Noi Ashong, while Mr Basilio Toth, the First Secretary at the Italian Embassy, initialled for his country.

Dr Ashong noted that the agreement on the relief between the two countries was negotiated on the basis of Italian Domestic Law to reduce the external debt of the heavily-indebted countries with low per-capita income.Dr Ashong said the Multilateral Agreement of Paris, dated May 16, 2002, rescheduled the instalments due in the period between the decision point and the completion point.

He said the rescheduling was limited to payments due between the period February 1, 2002 and November 30, 2002, since the IMF programme, "Poverty Reduction and Growth Facility? ,was expected to end in November 2002. He said the agreement had already envisaged the extension of the consolidation period after the approval of the new IMF programme.

Dr Ashong explained that the IMF programme was approved on May 9, 2003 and thus the agreement was amended on June 23, 2003 and the period of consolidation extended to cover the whole interim period from February 1, 2002 to March this year.

He said with the relief, the benefits would be shifted to other areas such as education, health, agriculture, among others.Dr Ashong said that would also create more jobs and give employment to people