Baker Plan (debt relief)

The Baker Plan was launched in October 1985 at the IMF World Bank meeting in Seoul, by James Baker, United States Secretary of the Treasury, as a way to combat the international debt crisis.

It was inspired by the idea that Japan's trade surplus could be used to relieve some of the Third World's problems with debt.Fact|date=April 2007 The Plan was designed to help highly indebted middle-income countries, i.e. those countries that are not incredibly poor but nevertheless owe a large amount of money. Fifteen countries were mentioned, and ten of those were in Central and Latin America.

Ultimately, the Baker Plan failed due to its inequitable principles on deciding which countries received aid.Fact|date=February 2008 A subsequent plan, the Brady Plan, also failed.

References

*Buiter, W. and Srinivasan, T.N. (1987) "Rewarding the Profligate and Punishing the Prudent and Poor: Some Recent Proposals for Debt Relief", "World Development Journal", Vol. 15, No. 3, pp411-417.
*Bogdanowicz-Bindert, C A, (1986) "The Debt Crisis: The Baker Plan Revisited", "Journal of Interamerican Studies and World Affairs", Vol. 28, No. 3, pp. 33-45.
*Rudolph, Barbara, " [http://www.time.com/time/magazine/article/0,9171,957269-1,00.html Enter The Brady Plan] ", "Time", 20 March, 1989.
*Riding, Alan, "Baker's debt plan gets Lating scrutiny", "New York Times", December 16, 1985.