As a result of a lucrative exemption, Lord Ashcroft pays very little tax to the Belize government, a situation which Clare Short was intent on changing, by threatening to withhold millions of punds of debt relief to the country. She argued at the time that there was little point in waiving the debts to help the country's suffering population if the government was voluntarily forgoing tax revenue.

Ms Short recently announced that she was prepared to write off £10 million worth of Belize's debts if it agreed to reform its financial regime, and end the tax relief enjoyed by Lord Ashcroft's companies. However, the government failed to act, and as a result, the citizens of the already impoverished country stand to lose out still further.

A spokesman for Lord Ashcroft, who has claimed in the past that Ms Short's actions have constituted a 'Get Ashcroft' campaign, criticised the withdrawal of debt relief:

'The government is punishing Belize- a country hit by two hurricanes- by refusing to allow any relief from debt. This dog in the manger attitude is just punishing the people of Belize because the government would not agree to Britain's demands,' Alan Kilkenhy said last week.

However, there have been whispers that the UK government's decision, although influenced by the Ashcroft case, has been swayed by other concerns regarding the country's financial regulatory regime. US government documents released in the wake of the September 11th terrorist attacks also suggested that the authorities there had concerns.