Brazil cancels most of Mozambique's debt
Brazil has announced that it will write off $314 million of the $331 million that it is owed by Mozambique – around 95 per cent of the debt. Brazilian President Luis Inacio ‘Lula’ da Silva said that through this gesture his country wants to show its determination to help other countries that are poorer and facing greater needs than Brazil. He said that it makes no sense at all that very rich nations – most of whose wealth was accumulated by exploiting other countries’ resources – continue to insist on collecting debts that have been proved definitely unpayable.
Between 1980 and 2000, sub-Saharan African countries, including Mozambique, paid more than $240 billion to service their debts. Yet, due to the deterioration in debt ratios, these countries still owe almost four times the amount that they owed more than 20 years ago.