The British government on Thursday announced the cancellation of 100 percent of Zambia's debt amounting to 245 million U.S. dollars following Zambia's attainment of the completion point under the Heavily Indebted Poor Countries (HIPC) initiative in April last year.

This brings the total debt cancellation by the United Kingdom up to 427 million dollars, according to a press briefing co- organized by the British High Commission in Zambia and the Ministry of Finance.

British High Commissioner to Zambia Alistair Harrison said debt relief has become one of the four keys on the economic relationship between Britain and Zambia along with the aid program, trade and investment.

"Debt relief allows the other three keys to flourish as never before," the British envoy said.

Zambian Finance Minister Ng'andu Magande promised that the Zambian government would use the freed resources to finance priority programs so as to benefit all Zambian people through greater provision of key public services and the development of the country's social and productive infrastructure.

"These priority programs will mainly cover sectors such as education, health and economic development," he added.

According to the minister, the southern African country will, in aggregate, benefit from a reduction of its overall external debt from over 7 billion dollars to less than 500 million dollars during the period of 2005-2006.

Source: Xinhua