More than half of Zambia's crushing 6.5-billion-dollar (five-billion-euro) debt -- 3.8 billion dollars -- is owed to the International Monetary Fund and the World Bank.

"We hope this money, which will be realised from the debt cancellation, will go towards improving the lives of people such as procuring AIDS drugs," World Bank representative Ohene Nyanin said.

"The savings from the debt cancellation should also go towards building schools, hospitals and roads so that people can see the benefits of debt relief," Nyanin told a news conference.

Finance ministers of the Group of Seven (G7) club of rich countries are due to meet in London next month to discuss a British "Marshall Plan" for Africa that calls for massive debt relief, a doubling of aid and breaking down trade barriers.

British finance minister Gordon Brown this week wrapped up a four-nation tour of Africa to discuss the plan aimed at helping the continent pull itself out of chronic poverty.

Close to 64 percent of Zambia's 10 million people live on less than one dollar a day. About one in six Zambian adults is infected with HIV or full-blown AIDS.

President Levy Mwanawasa announced a year ago that his government would provide free anti-retroviral drugs to about 100,000 AIDS patients through the public health system.

"There is also need to put in place fiscal discipline so that the funds realised from debt relief are not misapplied," said Nyanin.

Zambia began borrowing heavily in the late 1970s after its economy went into a tailspin following a sharp decline in the price of copper, its main resource.