Interview

US Ambassador Mary Carlin Yates ended more than two and a half years’ duty tour in Ghana in August 2005.  Before leaving, Mrs. Yates had time to speak about her time in Ghana and to clarify some of the sticky points in the Gleneagles decisions, which her country had helped shape  

The momentous June 2005 decision on debt cancellation, of which Ghana was to be one of 18 beneficiaries, and following that the Gleneagles G8 decisions on aid to the world's poor countries, came at a time when you were preparing to end your duty tour in Ghana. As US Ambassador to Ghana for the previous two and a half years you must have had first hand knowledge of what qualified Ghana for consideration for debt cancellation?
The congratulations belong to the Government of Ghana for qualifying for debt relief under the Heavily Indebted Poor Country (HIPC) Initiative and being included among the probable beneficiaries of further G8 debt relief following the Gleneagles agreement. Ghana's hard work and willingness to make sound, long-term economic decisions, despite short-term political risk, were the determining factors in achieving a more stable macro-economic environment, including reduced inflation and a stable exchange rate. The IMF and the World Bank, in evaluating this positive performance, determined that Ghana had met the criteria for reaching the HIPC "Completion Point." Ghana and the other 17 countries deserve to benefit from implementing sound economic policies.

The G8 Summit at Gleneagles refused to consider suggestions for total, unconditional debt cancellation in addition to the June 2005 debt cancellations and instead opted for a highly enhanced aid package.  Considering the genuine concerns about the numerous instances of aid abuse in the past, how does the G8 ensure that, this time, aid money would be properly applied?
The G-8 proposal does provide 100 percent irrevocable debt stock relief for post-Completion Point HIPC countries, including Ghana. Additional donor contributions by the International Development Association (IDA) and the African Development Fund (AfDF) will be allocated to all IDA-only countries, based on the existing performance-based allocation system. This approach ensures equity between HIPC countries and non-HIPC countries and creates an incentive for the pursuit of responsible, pro-growth policies.

How committed is the US to the Gleneagles decisions and how will she ensure that these promises are kept?
The US Government is committed to the Gleneagles G8 proposal for 100% debt relief for HIPC countries. Of course, the World Bank and the African Development Bank Governors, as well as the Executive Board of the IMF, must approve the proposal in order for it to be implemented. The US is working closely with these organisations and its donor partners to move the proposal forward.
               
Meeting the targets set in the Millennium Development Goals depends fairly largely on the delivery of the inputs promised by the US and other rich countries. Are the recent debt cancellation and enhanced aid promised by the G8 being linked in any way to the MDG?
Under the G8 proposal, the motivation for debt relief in the World Bank and the ADF is both to improve debt sustainability and provide additional resources to help countries achieve the MDGs. For this reason, the G8 made a commitment to provide additional contributions to the IDA and the AfDF on a dollar-for-dollar basis. In the case of the IMF, debt relief is intended to improve balance of payments positions and ensure debt sustainability, address roll-over pressures, make the IMF more effective in low-income countries, and help create the conditions for growth and stability, and in so doing support countries' effort to achieve the MDGs. Debt relief is linked to the attainment of the HIPC Completion Point and is not explicitly linked to MDG targets. Debt relief will, however, help countries' efforts to reduce poverty, increase growth and assist countries reach their objectives under the MDGs.

 For more than a year Ghana has been on the list of 16 selected countries waiting to benefit from the Millennium Challenge Account.  What is the reason for the long delay?
The Millennium Challenge Account (MCA) is a key part of the US Government's effort to increase assistance to countries that are taking responsibility for their own development. Given the stringent qualifying criteria for MCA eligibility, I consider it an enormous accomplishment for Ghana that it was included in the list of 16 countries that are to receive MCA assistance. The Millennium Challenge Corporation (MCC), which administers the MCA proposal, is collaborating with Ghana to develop its proposal, or "MCA Compact." On August 11, 2005, the MCC and Ghana signed a grant agreement under which the MCC is to provide up to $3 million to assist Ghana to continue the development of its proposal. This process of developing a proposal that will be fully fundable and truly transformational can be lengthy and complex. But the Government is attempting to develop a Compact that will transform Ghana's economy and the living standards of its citizens. We expect Ghana's Compact, when implemented, to provide significant support to Ghana's overall effort to reduce poverty and increase economic growth. We are honoured to be working with Ghana in this important effort, and our two sides are working as a team to complete the Compact as quickly as possible.    [ Back ]     read more >>