This report advocates a change from the traditional approach to debt cancellation based on crude financial measures, towards a system which protects the Government spending needed to meet basic human development needs, as well as not taxing those people who already live below the poverty line.
NEF’s new analysis adopts an ethical poverty line of $3 per person a day — a level more compatible with the basic human rights of well-being and health than the $1 and $2 a day poverty lines used by the World Bank and others.
Based on this, and using data for 136 countries, nef has calculated which countries will need 100 per cent cancellation of their debts and which will need some debt relief to reduce their debt to a sustainable level.
The results show that of the 136 countries surveyed, between 51 and 54 needed complete cancellation of their debts and between 32 and 53 needed partial cancellation on human rights grounds. Bangladesh and the Democratic Republic of Congo, for example, need 100% debt relief, amounting to $11.8 billion and $10.5 billion, respectively.
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