IMF Cancels Haiti’s $268 Million Debt

A boy in Cité Soleil carries away a hard-won bucket of water from a broken water pipe where many Haitians struggled for their share. The shanty town of Cité Soleil has been left with severely diminished water resources after a powerful earthquake rocked the area on 12 January.
A boy in Cité Soleil carries away a hard-won bucket of water from a broken water pipe where many Haitians struggled for their share. The shanty town of Cité Soleil has been left with severely diminished water resources after a powerful earthquake rocked the area on 12 January.
A boy in Cité Soleil carries away a hard-won bucket of water from a broken water pipe where many Haitians struggled for their share. The shanty town of Cité Soleil has been left with severely diminished water resources after a powerful earthquake rocked the area on 12 January.
A boy in Cité Soleil carries away a hard-won bucket of water from a broken water pipe where many Haitians struggled for their share. The shanty town of Cité Soleil has been left with severely diminished water resources after a powerful earthquake rocked the area on 12 January.

Today in Latin America

Top Story — The International Monetary Fund (IMF) approved Wednesday the cancellation Haiti’s $268 million outstanding debt.

On top of the debt cancellation, the IMF’s executive board approved a three-year request by authorities to support Haiti’s reconstruction and growth program. The $60 million loan is intended to boost Haiti’s international reserves and aid the central bank in managing potential swings in the value of the local currency.

Both decisions are part of an effort to aid the Caribbean nation after the the devastating earthquake six months ago that has left some 230,000 people dead and more than a million homeless.

“Donors must start delivering on their promises to Haiti quickly so reconstruction can be accelerated, living standards quickly improved, and social tensions soothed,” IMF Managing Director Dominique Strauss-Kahn said on Wednesday, according to the BBC.

The loan’s interest rate will be zero through 2011 and as much as 0.5 percent after that, according to the IMF.

The IMF and other international lending organizations have been under criticism recently for their loan practices with developing nations, such as Haiti.

“While it is welcome that the fund is providing Haiti with debt relief, it is deeply concerning that at the same time the fund is risking a build-up of Haiti’s future debt problems with a loan,” Oxfam International Policy Adviser Pamela Gomez said in a statement, according to Bloomberg. “This assistance should be a grant, not another loan.”

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