Debt relief in Mozambique

29 January 2010

In September 2001 Mozambique reached Completion Point under the enhanced Heavily Indebted Poor Countries Initiative (HIPC) initiative and received $4.3 billion debt service relief. 

Mozambique has more than tripled its poverty reducing expenditure from $792 million to over $2 billion since 2001. This has contributed to a large increase in school enrolment rates: from 64% in 2003 to close to 100%. This means in an increase in numbers of children in primary education from 3,023,369 to 4,821,625 (an increase of nearly two million children attending schools). Improvements have also been made for women: since 2003, 120,000 more women per year are able to give birth in a hospital or clinic. In addition, infant mortality decreased from 147/1000 live births (1997) to 100/1000 (2008). 

Mozambique used its debt service savings to vaccinate one million more children against tetanus, whooping cough and diptheria, as well as build and electrify schools. In addition, Mozambique has invested in the fight against HIVand AIDS and used debt savings to open 50 new testing and counselling offices by 2007/08.

The UK has been instrumental in developing and implementing international debt relief initiatives such as the enhanced HIPC Initiative and Multilateral Debt Relief Initiative (MDRI). These initiatives have so far delivered around US $117 billion worth of debt relief to poor countries. Annual spending on anti-poverty programmes has increased from approximately $6 billion in 2000 to $27 billion in 2008.