The G7 have agreed changes to the Heavily Indebted Poor Country Debt Initiative which will impose more conditionality in return for earlier relief from interest payments.
Mr Jagdeo, Guayanese Finance Minister, has attacked the IMF for its lack of commitment to debt reduction and using the HIPC Initiative as a means of forcing countries to comply with ESAF programmes.
Investors’ growing aversion to risk is leading to a general withdrawal of finance from many Southern countries.
In addition to extending the IMF’s role, its governors have been examining measures to prevent future financial sector crises.
Borrowers from the International Bank for Reconstruction and Development (IBRD), the main World Bank lending arm, may have to pay higher charges for their loans in the future.
An estimated 70,000 people demonstrated in Birmingham to call on G8 leaders to cancel poor countries’ unpayable debts.
Nicaraguan civil society organisations (CSOs) fear Nicaragua will not qualify for the HIPC Debt Initiative before the population has suffered further.