Debt Relief for Nicaragua: Breaking out of the poverty trap

Publication date

01 Oct 1998


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Nicaragua is Latin America's poorest country, with some of the worst indicators for human welfare. It also has the world's highest level of per capita debt, at around US$1,300 per capita, and one of the highest ratios of debt to GDP. Even though Nicaragua consistently fails to service its debt in full, actual debt repayments are two and a half times spending in health and education combined. This diversion of resources is taking place in a situation characterised by extreme poverty.