Battles on debt and poverty on eve of UN Summit
12 September 2005As the UN World Summit and meetings of the World Bank and International Monetary Fund approach, the hope that 2005 would be a year of significant progress on international debt and combating poverty is under severe threat. This weekend's meetings in preparation for the Annual Meetings of the IMF and World Bank on 24/ 25th September have coincided with last minute negotiations on the outcomes document for the UN World Summit later this week. Documents leaked to Jubilee Debt Campaign in July revealed that some European Directors in Washington were casting doubt on various aspects of the debt deal agreed by the G8 leaders at Gleneagles in July. These doubts have escalated, and there appears to be genuine concern that the deal might not be agreed in full in two weeks time. "It is hard to overestimate the growing sense of outrage that even the slightest signs of genuine progress on debt are still in doubt," said Stephen Rand of Jubilee Debt Campaign. "In the context of the battle raging at the UN to hold on to the global consensus on combating poverty achieved over the past five years, it seems that the wealthy nations of the world are in danger of turning their backs on the 30,000 children who die each day because of poverty." On 10th August the UN draft outcomes document included this section on debt: We emphasize the urgent need for an effective, comprehensive, durable and development-oriented solution to the debt problems of developing countries. To this end we:
- Welcome the recent decision of the Group of Eight countries to cancel 100 per cent of the outstanding debt of eligible heavily indebted poor countries owed to the International Monetary Fund, the International Development Association and the French Development Agency and to provide additional resources to ensure that the financing capacity of the international financial institutions is not reduced.
- Stress that in assessing debt sustainability, consideration should be given to the level of debt that allows a country to achieve its national development goals, including the Millennium Development Goals, recognizing the key role that debt relief can play in liberating resources that can then be directed towards activities consistent with attaining sustainable growth and development.
- Further stress the need to consider additional measures and initiatives aimed at ensuring long-term debt sustainability through increased grant-based financing, cancellation of 100 per cent of the official debt of heavily indebted poor countries and significant reduction or cancellation of the debt of many heavily indebted least developed countries that are not part of the Heavily Indebted Poor Countries Initiative, as well as of low- and middle-income developing countries. Such initiatives should include efforts by the International Monetary Fund and the World Bank to develop a debt sustainability framework for low-income countries. This should be achieved without a reduction in resources channelled as official development assistance as well as other sources of financing available to other developing countries, while stressing the need to maintain the financial integrity of the multilateral financial institutions.
- Stephen Rand, co chair, Jubilee Debt Campaign 07889 158215: Stephen is in New York for the UN Summit on behalf of JDC and Make Poverty History and will be in Washington for the Annual Meetings of the World Bank and IMF.
- Trisha Rogers (07712 005666) and Caroline Pearce (07791 971890) are in the UK.