$1.2 bil­lion dol­lars of Haiti’s debt was can­celed yes­ter­day by the World Bank and the Inter­na­tional Mon­e­tary Fund. The two mega banks have an debt can­cel­la­tion pro­gram, where a coun­try can have their debts for­given as long as they do man­dated changes to the way the coun­try operates.

Haiti had to do some audits, adopt new laws and change debt report­ing. Haiti did all of this while suf­fer­ing through food riots and four trop­i­cal storms last year.

From the St. Augus­tine Record, Jonathan Katz tells us more on how the debt for­give­ness will ease Haiti’s situation.

The actions erased nearly two-thirds of Haiti’s out­stand­ing debt. As of April, Haiti owned more than $1.9 bil­lion, accord­ing to the Washington-based Cen­ter for Eco­nomic and Pol­icy Research.

“This is a pretty big vic­tory, def­i­nitely. This is what we’ve been want­ing,” said Dan Bee­ton, an ana­lyst with the cen­ter, said by phone from Wash­ing­ton. “It’s a shame it had to take so long.”

Until now, the des­per­ately poor coun­try, where more than 80 per­cent of its approx­i­mately 9 mil­lion peo­ple live on less than $2 a day, has been pay­ing about $1.6 mil­lion each month to the World Bank, accord­ing to debt relief advo­cates at the Jubilee USA Network.

A sig­nif­i­cant por­tion of the debt for­given Tues­day dates back to loans that lined the pock­ets of Haiti’s dic­ta­tors, espe­cially Fran­cois “Papa Doc” and Jean-Claude “Baby Doc” Duva­lier, whose father-son dynasty ended in a 1986 pop­u­lar rebellion.

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