In 1996, the World Bank and the International Monetary Fund (IMF) launched the Debt Initiative for Heavily Indebted Poor Countries (HIPC) Initiative, which created a framework for all creditors, including multilateral creditors, to provide debt relief to the world's poorest and most heavily indebted countries, and thereby reduce the constraint on economic growth and poverty reduction imposed by the debt build-up in these countries. The HIPC Initiative was designed as one important building block in broader development architecture of policies, programs and institutional development in support of sustainable growth and poverty reduction.

This study was designed to establish whether the HIPC funds that were release for poverty reduction indeed helped reduce poverty and at what rate it did. The research an experimental focused on identifying the relationships between growth rate, poverty rate before HIPC releases and after the release.

The study showed that poverty rate reduced quiet significantly after the country joined the HIPC initiative and also growth rate. These findings were interpreted and discussed in the context of literature and a number of implications and recommendations were drawn.