Following Cameroon's attainment of the Completion Point of the Heavily Indebted Poor Countries (HIPC) initiative, the International Monetary Fund has just taken a giant stride by relieving Cameroon of the debts owed it and incurred before January 01, 2005. Read excerpts of the joint press release by the World Bank and IMF.

"The International Monetary Fund (IMF) and the World Bank's International Development Association (IDA) have agreed that Cameroon has made sufficient progress and taken the necessary steps to reach its completion point under the Enhanced Heavily Indebted Poor Countries (HIPC) Initiative. Cameroon becomes the 19th country to reach the completion point under HIPC.

Debt relief to Cameroon under HIPC will be approximately US$1.267 billion in 1999 NPV terms, equivalent to a 27 percent NPV reduction of Cameroon's debt after traditional debt relief. This will reduce Cameroon's future debt service payments by about US$4.9 billion in nominal terms.

The US$1.267 billion in reduced debt is attributable to multilateral, bilateral, and commercial creditors. The breakdown of the Enhanced HIPC Initiative assistance is as follows (in NPV terms):

- US$176 million from the World Bank Group;

- US$37 million from the IMF;

- US$79 million from the African Development Bank Group;

- US$31 million from other multilateral creditors;

- US$879 million from bilateral creditors;

- US$65 million from commercial creditors.

In reaching the HIPC completion point, Cameroon also becomes eligible for further debt relief from the IMF, IDA, and the African Development Fund (AfDF) under the Multilateral Debt Relief Initiative (MDRI). Debt relief provided under MDRI will amount to US$1.130 billion at the current exchange rate, in addition to US$202 million relief to be received from the three institutions under the HIPC Initiative. The IMF will provide 100 percent debt relief on all debt incurred by Cameroon to the IMF before January 1, 2005, that remains outstanding to date. This amounts to US$255 million, of which US$219 million financed by MDRI and US$35 million by HIPC. The IMF's MDRI relief will become effective immediately. The additional debt relief under the MDRI by IDA and the AfDF will amount to US$721 million and US$190 million, respectively, with implementation beginning after July 1, 2006 ."