11.

This Initiative is an international debt relief measure against HIPCs and the G7 agreed at the Cologne Summit in 1999. The measure will be implemented in two phases: Decision Point and Completion Point. In the first phase the qualified HIPCs should formulate their national Poverty Reduction Strategy Papers (PRSP) describing the policies on use of financial resources that became available as a result of debt relief. The World Bank and the IMF Executive Board will then approve the PRSP. The approval of the Initiative will be decided based on the PRSP, the HIPC's actual achievement on the economic and social reform program the IMF has demanded, and the analysis on debt repayment capacity of the indebted country. The approval of the Initiative means it entered the Decision Point phase. Debt relief will be provided to the qualified HIPCs that reached the Decision Point as a mid-phase relief. Then the economic and social reform program will be implemented as a second phase. If the country is acknowledged as having demonstrated favorable achievements, it means it reached the Completion Point. To those countries the debt relief will be provided by cutting down 90% or more of their outstanding debt.