Developing World: Debt Reduction - Question

Part of the debate – in the House of Lords am 3:18 pm ar 13 Chwefror 2024.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Photo of Lord Cameron of Chipping Norton Lord Cameron of Chipping Norton Foreign Secretary, Foreign, Commonwealth and Development Office 3:18, 13 Chwefror 2024

As ever, my noble friend makes a very good point. If we look back at the successful programmes that there were, such as the heavily indebted poor countries initiative, we see that they helped, but many of those countries have gone back into debt—although the situation is not as bad as it was before: the debt-to-GDP ratios in very indebted countries is some 60%, whereas it had got to 100%. One of the best things we can do for those countries is to help them to have better fiscal systems so they can raise their own taxes. I know that noble Lords like a Rwanda update: we have been working with that country since the 1990s and helped it to increase its tax revenue tenfold, and its ratio of tax to GDP has doubled from 8% to 16%, the highest in the region. That is a better thing to do in many instances than lending those countries money.