A man with a double leg amputation begs in a street in Kabul (File photo - April 1, 2004)

Afghanistan has welcomed the decision by leading Western creditors to cancel the country's debts. The United States says it will cancel its entire $108 million debt and called on all of Afghanistan's lenders to follow suit.

Afghan government spokesman, Khaleeq Ahmed, on Wednesday applauded the U.S. move, which eliminates a major financial constraint on Afghanistan's new democracy.

"After 30 years of war and devastation, we are starting from nothing basically," said Ahmed. "It will take a long time for us to be fully self-sufficient."

Announcing the U.S. decision Tuesday, State Department spokesman Sean McCormack urged other members of the so-called Paris Club of leading creditor nations to provide 100 percent debt forgiveness.

McCormack said that despite numerous challenges, Afghanistan is working hard to build a stable market economy.

"The solution of the debt problem through the Paris Club process will strongly contribute to the development of Afghanistan's trade, investment and other economic ties with its major creditors and with the rest of the world," he said.

Earlier this week, both Russia and Germany announced plans to cancel Afghanistan's outstanding debts.

Aid agencies are also welcoming the decision, saying the debts were a significant obstacle to Afghanistan's financial growth and independence.

"…especially when you look at the fiscal sustainability of the Afghan government, it's very important that they're not burdened with debt," said Christian Dennys, who works for the British aid group Oxfam in Kabul.

The announcements follow last week's donor conference in London where nearly 70 countries and international bodies pledged more than $10 billion for the war-torn country.

The money is intended to assist Afghanistan to strengthen its economy, crack down on the country's booming drugs trade, and improve security.