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Heavily Indebted Poor Countries

Heavily Indebted Poor Country (HIPC)

The heavily indebted developing countries (also named "poor" countries) are a subgroup of the developing countries defined by the International Monetary Fund (IMF). The aim of this classification in 1999 was debt relief proposed by the G8 countries, initiated by Germany.
Of the current 36 countries, most are in Africa. A total of about 780.65 million people live in affected countries, which corresponds to 10.0 percent of the world's population.
world map Heavily Indebted Poor Countries
CountryPopulationGNI per capitaHuman Development IndexDebts
Afghanistan39.8 M500 USD0.47815.0%
Benin12.5 M1,370 USD0.52533.9%
Bolivia11.8 M3,360 USD0.69242.7%
Burkina Faso21.5 M860 USD0.44927.0%
Burundi12.3 M240 USD0.42621.9%
Cameroon27.2 M1,590 USD0.57634.7%
Central African Republic4.9 M530 USD0.40438.1%
Chad16.9 M650 USD0.39436.7%
Comoros0.9 M1,460 USD0.55824.5%
Democratic Republic of the Congo92.4 M580 USD0.47912.9%
Ethiopia117.9 M960 USD0.49828.4%
Gambia2.5 M800 USD0.50042.2%
Ghana31.7 M2,360 USD0.63244.3%
Guinea13.5 M1,010 USD0.46529.1%
Guinea-Bissau2.0 M780 USD0.48355.3%
Guyana0.8 M9,380 USD0.71432.7%
Haiti11.5 M1,420 USD0.53515.9%
Honduras10.1 M2,540 USD0.62150.0%
Ivory Coast27.1 M2,450 USD0.55042.2%
Liberia5.2 M620 USD0.48152.1%
Madagascar28.4 M500 USD0.50138.5%
Malawi19.6 M630 USD0.51224.8%
Mali20.9 M870 USD0.42836.3%
Mauritania4.8 M1,730 USD0.55673.1%
Mozambique32.2 M480 USD0.446154.4%
Nicaragua6.7 M2,010 USD0.66798.3%
Niger25.1 M590 USD0.40034.9%
Republic of the Congo5.7 M1,630 USD0.57161.1%
Rwanda13.3 M850 USD0.53481.1%
Sao Tome and Principe0.2 M2,280 USD0.61861.9%
Senegal17.2 M1,540 USD0.51171.7%
Sierra Leone8.1 M510 USD0.47753.0%
Tanzania61.5 M1,140 USD0.54941.3%
Togo8.5 M980 USD0.53933.5%
Uganda47.1 M840 USD0.52546.5%
Zambia18.9 M1,040 USD0.565170.7%

Criteria for admission

Before being included in the debt relief initiative, the World Bank and the International Monetary Fund lay down strict criteria. The aim is to cancel debts only for those states that are already heavily indebted and are in all likelihood unable to pay these liabilities on their own. On the other hand, these states should also have the ability to grow out of poverty after a waiver. A state must therefore not only be particularly poor, but must also fulfil certain conditions at the political level.
These conditions are usually determined and monitored over several years in a three-stage process. Eritrea, Somalia and Sudan, for example, have been on the list for some time now of countries that fulfil the conditions of poverty. None of these three countries has so far been able to convincingly demonstrate or even show that the government is also capable of fighting poverty. To achieve this, it is also necessary to implement effective reforms in advance and to demonstrate success.

Doubts about sustainability

The aim of the initiative is to reduce poverty in the affected countries and to enable governments to stand on their own two feet through debt relief. The reform programs controlled by the community are designed to achieve effective action. An already economically weakened country may also use this debt relief to borrow money again from other states and not pay it back either.
Another injustice is that individual countries are rewarded with debt relief even though they have not managed to stand on their own two feet, while the countries that are just above the poverty line because their reforms have been successful are not rewarded.

Key figures in comparison

(All figures weighted according to population share.)
 Heavily Indebted Poor CountriesWorldUSA
Total population780.7 m7.8 bn331.9 m
GNP per capita1,051 USD12,070 USD70,430 USD
Government debt (% of GDP)49.3 %93.9 %119.0 %
Expenditure on education (% of GDP)3.9 %3.7 %4.9 %
Unemployment rate5.1 %6.2 %5.5 %
Literacy rate63.1 %86.7 %0.0 %
Electricity access45.9 %90.5 %100.0 %
Birthrate34.5 ‰17.3 ‰10.9 ‰
Life expectancy63.8 years72.7 years77.3 years

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Developing countriesList of 152 developing countriesList of all 152 developing countries with below-average living standards