A/HRC/14/21 Enhanced HIPC Initiative to ensure faster, deeper and broader debt relief with the core objective of poverty reduction. In 2005, the HIPC Initiative was supplemented by MDRI to help accelerate countries’ progress towards the Millennium Development Goals. MDRI ostensibly provides countries that complete the HIPC Initiative with full debt cancellation from four main multilateral institutions: IMF, the International Development Association (IDA), African Development Fund (administered by AfDB) and the Inter-American Development Bank.32 28. As of end-July 2009, 26 of the 40 eligible countries had completed the HIPC Initiative and qualified for irrevocable debt relief, while a further 9 had reached the decision point and qualified for interim debt relief. In September 2009, the World Bank and IMF reported that the total debt relief committed to the 35 post-decision-point HIPCs under the initiatives was US$ 124 billion (in nominal terms), representing on average about 40 per cent of the 2008 GDP of these countries.33 Commercial creditors account for 6 per cent of the total cost of debt relief to be provided to the 35 post-decision-point HIPCs, but only around a third of this has been provided. 29. According to the World Bank and IMF, the two international debt relief initiatives have helped significantly reduce the external debt burden of HIPCs and contributed to creating the fiscal space necessary for poverty-reducing expenditure and economic development in these countries. Countries that have benefitted from debt relief have increased average spending on health and education and now spend on average six times more on these basic services than they do on debt service. The 2009 HIPC and MDRI status of implementation report indicates that between 2001 and 2008, poverty-reducing spending in the 35 post-decision-point HIPCs increased by 2 percentage points of GDP on average, while debt service obligations declined concomitantly. 30. There is a dearth of empirical studies on the impact of HIPC and MDRI debt relief on economic and human development. Nevertheless, a few studies show a positive correlation between the reduction in debt service and the increase in poverty-reducing expenditure. For example, a study by Crespo Cuaresma and Vincellette shows that average educational expenditures are about 18.5 per cent of total government expenditures in postcompletion-point HIPCs, which is 2 to 3 percentage points higher than in pre-decision-point countries.34 31. From a human rights perspective, reduced debt burdens and increased fiscal capacity have contributed to the creation of the conditions necessary for the realization of human rights, particularly economic, social and cultural rights, in HIPCs. Some of the human rights impacts of debt cancellation include the abolition of primary school fees in Ghana, Malawi, Uganda, the United Republic of Tanzania and Zambia, resulting in increased school enrolments in these countries; abolition of user fees for health care in Zambia, thereby making basic health care available to millions of Zambians living in rural areas; and improvement of health care in Mauritania and the Plurinational State of Bolivia.35 32 33 34 35 GE.10-13156 The initiative covers all post-completion point HIPCs. Debt relief covers all debt due to IMF, the African Development Fund, and Inter-American Development Bank (IDB) by end-December 2004 and all debt due to IDA by end-December 2003 and still outstanding at the time of qualifying (i.e. after HIPC Initiative debt relief). See www.imf.org/external/np/exr/facts/mdri.htm. IDA and IMF, “HIPC Initiative” (2009) (see footnote 7), para. 4. J. Crespo Cuaresma and G.A. Vincelette, “Debt relief and education in heavily indebted poor countries” in C.A. Primo Braga and D. Domeland (eds.), Debt Relief and Beyond: Lessons Learned and Challenges Ahead (Washington DC, World Bank, 2009), pp. 40–41. See Jubilee Debt Campaign, Unfinished Business: Ten Years of Dropping the Debt (London, Jubilee Debt Campaign, 2008), pp. 25–26. 11