HIPC Initiative

The Heavily-Indebted Poor Countries Initiative was adopted in 1996 by major industrialized countries to provide a comprehensive approach to helping poor countries with their debt burdens with a goal of getting the debt to sustainable levels. By granting debt relief, the HIPC Initiative hoped to reduce the constraints on economic growth, reduce poverty, and allow countries to pay future interest payments without needing further debt relief. The HIPC Initiative works with other creditors clubs such as the Paris Club. The HIPC Initiative is led by the World Bank and the International Monetary Fund.