A/HRC/4/10 page 2 Summary In the present report to the Human Rights Council submitted pursuant to Commission on Human Rights resolution 2005/19 and Human Rights Council decision 1/102, the independent expert on the effect of economic reform policies and foreign debt on the full enjoyment of all human rights, Bernards Mudho, outlines the evolution of his mandate during the past years and summarizes its main results. The first part of the report analyses recent debt relief initiatives and their impact on poverty reduction and the realization of all human rights. It concludes that current concepts of debt sustainability used by the Bretton Woods institutions do not sufficiently reflect Millennium Development Goals (MDGs) and human rights related objectives. Integrating local views, for example, through domestic peer review mechanisms could help in defining a more complete and balanced picture of debt sustainability. The report emphasizes that debt service savings resulting from the Heavily Indebted Poor Countries (HIPC) and Multilateral Debt Relief (MDR) initiatives are probably too small to have a measurable impact on MDGs or human rights improvement in poor developing countries. There is continued need for more comprehensive solutions not only with regards to further debt relief, but also in the closely linked areas of fiscal/debt management and trade. All creditors should, in particular, define their own transparent criteria for the illegitimacy of certain categories of debt, and proceed to their cancellation. The report underlines the shared responsibility of creditors and borrowers with regards to poor countries’ current and future foreign debt burden. To that end, it urges that forward-looking debt sustainability analysis tools should guide both the creditors and borrowers in their decisions and in the choice of an adequate mix of concessional loans and grants. In this context, the primary responsibility of the borrowing countries, to ensure that credits are invested in a productive and human rights promoting way, is recognized. In its second part, the report reviews possible human rights implications of standard reform policies promoted by the multilateral financial institutions. While recognizing the importance of broad macroeconomic stability for growth, development and realization of human rights, the report underlines the equally important need for county-specific solutions instead of one-size-fits-all stability thresholds and macroeconomic schemes. In examining the reform policy of privatization of State enterprises the report highlights its possible positive impact on the human rights situation, but cautions that careful consideration must be given to all the functions and purposes that a public enterprise serve, in particular with regards to accessibility to goods and services that result in the realization of pertinent human rights. Concerning trade reform policies, the report calls for sound economic and social impact assessments, allowing for a careful design and scheduling of reform steps, including adequate transition periods, balanced exclusion of strategic products from liberalization, as well as human rights-inspired safeguard clauses. Trade liberalization should be combined with measures to improve the productive capacity of the poor country’s economy and to strengthen its competitiveness on the global market. The report underscores the importance of governance