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U.S. CANCELS SOME AFRICAN NATIONS’ DEBTS

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The United States will cancel debt potentially billions of dollars - owed the United States by sub-Saharan African countries.

The announcement Thursday by President Bush marks a reversal for the United States, which has preferred only to stretch out repayment terms for debtor nations."Beginning Oct. 1 the U.S. government will forgive official development loans in the sub-Saharan countries," the president told a news conference.

In 1987, the most recent year in which figures were immediately available, the State Department put the total of U.S. loans to sub-Saharan Africa at $4.3 billion, including $743 million in development loans, $1.5 billion from the U.S. government's Export-Import Bank and $1.2 billion in U.S. government loans to buy surplus American farm products.

Bush did not say which of these categories would be included.

Africa south of the Sahara Desert is usually taken to mean all of Africa except South Africa and the North African countries on the Mediterranean - Egypt, Libya, Tunisia, Algeria and Morocco.

Bush said his action would be in accordance with a decision made last year in Toronto at an economic summit of industrialized democracies to offer different options to creditor governments.

Other governments, notably West Germany, France, the Netherlands and the Nordic countries, have converted many loans into grants.

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Clearing the slate

Industrial nations should join banks in writing off up to 50 percent of the Third World debt, former Secretary of State Henry Kissinger said in Caracas, Venezuela. "Realistically, banks alone cannot bear the burden of what creditors have to do," he said Thursday. Kissinger, in Caracas for a three-day visit at the invitation of President Carlos Andres Perez, denied reports he would be paid by Venezuela to help it renegotiate the terms of its $33 billion foreign debt. Perez's efforts to impose austerity measures in this country, backed by international creditors, prompted riots in February that killed about 300 people. Kissinger called for reducing Third World debt by up to 50 percent, "depending on the performance of the debtor country." Latin America, led by Brazil, Mexico and Argentina, owes foreigners $401 billion.