microfinance loans, debt relief

Why do poor countries often have debt?

A debt crisis occurred due to high oil prices (which made imports expensive) and exports worth less due to low commodity prices

What is debt relief?

The cancelling of debt so that poorer countries don’t have to keep spending money on paying back debt

What drawbacks are there of debt relief?

Some countries may get into more debt expecting the debt to be cancelled

Some governments are corrupt and will keep the money for themsleves rather than the people

Example of how debt relief has helped?

Tanzania has been able to invest more in education - attendance increased by 66%

Uganda - more money spent on safe water for 2 million

What is microfinance?

Small-scale financial support, which enables individuals/families to start up small businesses - creates jobs and income

Example of microfinance loans?

Grameen Bank, Bangladesh - loans are usually less than $100, with low interest. Some women buy phones with the money, and lend it to people