Reframing the debate: the debt relief initiative and new normative values in the governance of third world debt

The introduction of the Heavily Indebted Poor Countries (HIPC) initiative in 1996 established landmark legal and policy innovations both in the regulatory landscape of sovereign debt and in the framework of international development finance. As the HIPC framework draws to a close, this paper reviews the impact of this initiative on the regulation of sovereign debt, in particular the governance of third world debt. The paper considers the implications of the initiative's explicit link between debt restructuring and development policy and its incorporation of non-traditional normative values, such as poverty reduction and participatory development, into the legal and political discourse of sovereign debt. The paper argues that while the changes which brought about the HIPC initiative have led to a number of key initiatives to reform the governance of third world debt, they have also had the contradictory effect of reinforcing the core disciplinary discourses and pre-existing practices of the sovereign debt regime.