Reply #38: Norway: Gov’t cancels Third World debts

[BayCityProgressive]

The Norwegian government has announced cancellation of debt worth $80 million owed by five developing nations. On Oct. 2 it relieved Egypt, Ecuador, Peru, Jamaica and Sierra Leone of interest payments on debts incurred for purchases over 25 years ago of ships built in Norway. Government spokespersons indicated that debt cancellation would not affect developmental aid from Norway. In a first for creditor nations, Norway based its action on a reappraisal of the original decision to lend money. The impetus to sell ships came from a need to prop up a dying shipbuilding industry, not from consideration of benefits for poor nations. Action Africa sees Norway’s action as significant for African nations. Co-Executive Director Ann-Louise Colgan, quoted on AllAfrica.com, said Norway’s “willingness to accept responsibility for illegitimate lending set an important precedent that other international creditors must heed. can no longer turn a blind eye to their own historically unfair and corrupt lending practices.”