Why is it difficult to vsncel the entire third world debt?

[dave_c]

Excluding the tragic events in south east asia, genarally why is cancelling the third world debt such a complex matter? Do the developed nations need that money? Please enlightening me.

[ian.miller]

A VERY broad explainiation is:

Just like any business, governements have a balance sheet of money they are owed and money they owe / spend etc. If they were to cancel debt, then that money comes out of their own balance sheet. So if they were planning on spending �1bill on something like teachers and that money would have come from debt repayments then they don't have the money to spend.

So if we unilaterally cancelled all the debt we would have less money to spend on roads/schools/NHS etc etc

[ginger 69]

whats a debt? when loads of people died and loads of new babies are starving to death?