The illegal foreign debt: the value and likelihood of a legal ruling

(April 21, 2001) A recent Argentinian court decision on foreign debt sends a clear message to the citizens of highly indebted countries that international creditors were responsible for ensuring foreign loans were not used for the interests and needs of the state.

Prepared for the International Jubilee 2000 Conference Bamako, Mali, April 21-23 2001

Some initial reflections
For too many years now the foreign debt has been the main obstacle to the development of the poor and emerging countries. This is a vital issue, which inevitably conditions our future as independent nations. State power has been replaced by the power of the banks. As the visible head of transnational financial power they speculate, decide and are the real authors of the structural adjustment plans that invariably follow as a result of the policies applied by the multilateral credit agencies.

The model established seeks increasingly to consolidate the power of the markets, exacerbating social exclusion and without the slightest concern for the vast contingents of people thrown onto the poverty heap. Throughout the planet it has spread appalling poverty that statistics only reflect superficially. World Bank figures state that Third World debt at the end of 1994 had reached a billion 945,000 million dollars, and has continued to rise since then. That year the debt represented 40,6% of Latin America’s GNP, 29,4% of that of Asia, and 71.4% of that of Africa, reaching 107,3 in the case of sub-Saharan Africa. In Argentina, the foreign debt today is some 220,000 million dollars and the sum of 22,000 million dollars is to be paid in interest and amortisation for this year: the immediate future could hardly present a more terrifying prospect. Dr. Rudiger Dornbusch, star Professor at Massachusetts Institute of Technology and guru of the financial establishment, a few days ago said this of my country: “a central issue with Argentina is the breakdown of government. The answer is not only restructuring the foreign debt and the general public debt. A major fiscal reform including relations between the Nation and the provinces is required. It would be a mistake to turn to Washington or Europe for a last minute bailout. The time has come to confront the crisis and to apply the radical adjustment called for at this juncture. Who doubts that a 30 per cent drop in wages is part of history? But it is not only a wages drop. There is much more which needs to be tackled from debt reduction, to fiscal reform. To be successful, Argentina needs a significant and lasting increase in the national savings rate and privatisation of what is still in state hands.” The same old recipes, the same old adjustments, the same old arrogance of power.

The foreign debt, says Professor Pier?ngelo Catalano, (1) is the slavery of the third millennium, and stems from a clear ideology, with historic roots in western thought that today globalised capital is attempting to impose. The imperative of our times is to stand up against this slavery, eschewing hackneyed phrases, academic conjectures, mobilisations too soon over, and rhetoric that argues the case for their ever-encroaching economic model. Rather, we need an action to unite all our countries, which in a steadfast and exemplary way obliges the creditors to drastically rethink their demands.

I personally think that unilateral voluntarism and some forms of activism are no longer effective. Therefore, we need to generate other forms of sufficiently vigorous opposition to face up to the financial powers-that-be. Also, we need to make our voices heard in the international organisations, obliging them to adopt decisions responding to clear precepts of international law, and acting as a brake upon the creditors who to date have acted as they pleased.

Creditors have formed a de facto triangular system that invariably functions to the detriment of the debtor countries. The IMF and the World Bank on the one hand, the Paris Club on the other with the private banks making up the third segment. It is absolutely not possible to come to individual or bilateral arrangements with these different groups as they always make impossible conditions, obtaining conformity of some of the other parties in the renegotiation process. This reality, observable in any of our countries, reveals the absurdity of the fallacy that some maintain that the debt issue pertains specifically to the private banks, and only exceptionally are governments involved. In all cases, behind the banks stand the multilateral organisations and the governments that uphold them, who control and influence their decision-making. While they design common strategies they systematically obstruct any attempt to formalise a debtor countries grouping which might sit down on an equal footing with the creditor countries.

However my idea here was not to refer to the foreign debt, as all present are familiar with its characteristics, its implacable machinery of subjection, the conditionality that it imposes upon the development of our countries. Rather I thought to make a proposal for discussion, based on a recent experience in my country that could prove to be a particularly useful tool in tackling the issue of the debt, with unified and decisive actions rather than abstract theories. As well as exposing the fraudulent mechanisms of this instrument of domination, it helps us prevent its continuation. We must oppose the destructive ideology imposed by globalised capital, by creating a common strategy that allows us to carry out effective actions, that fortify us and help us find, as Sada Diarra (2) said, simple objectives and policies that unite us.

To do this we need to draw up action plans able to really tackle the debt issue from a new perspective, where we are not asking forgiveness. We need to focus our struggle on determining the origin of this outrageous fraud, the methods employed, the destination of the alleged funds, the unilateral modification of conventions, the legitimacy of the contracting parties, the root of the corruption that has seeped throughout this whole process. As Galbraith pointed out: “…in a large part of the planet there is no perceptible economic development and degradation of the standard of living is the norm. This is the case of most of Africa, Central America, most of South America and some regions of Asia. In the present-day economic debate, this world is ignored, but if we care about human values and human suffering, it should be at the heart of our concerns (3).

In recent times there has been repudiation of this systematic domination exercised by the financial powers, flouting all control or government. Jubilee 2000 since its creation has put up an admirable fight. It has produced exhaustive and enlightening analysis of indebtedness, campaigning against the groups in power who have at their discretion the economies of the whole world, and against the growing exclusion of the poor countries. Jubilee 2000 has participated in actions in every continent to reduce the huge tribute of the debt burden. In the most far-flung corners of the planet it has accompanied mobilisations intended to show the other face of this phenomenon of globalisation. Actually this is nothing more nor less than an out-of-date euphemism for old-style imperialism adopting other guises to achieve its same old aim of subjection. The history of Latin America and the African countries are sterling examples of this. I believe that all the actions taken have been good, because they reject the uniformity which they tried to impose on us via a single discourse preaching the inevitability of certain policies and the non-existence of other options. However, while this activism has meant that there is a growing awareness of an unsustainable situation, I believe that the time has come for a new project, no longer founded on simple discussion of different policies, or on discrepancies over different economic theories, but rather in concrete actions with a substantive legal foundation, which allows us to change a system which enslaves us and whose projections are of increasing concern…

What has been achieved so far
Many initiatives have been devised to confront the debt problem but so far they have not been successful in obstructing the mechanisms wielded by the creditors. The Heavily Indebted Poor Country (HPIC) initiative has conditions attached that effectively sabotage its application. Further, it is a proposal imposed from the U.S. with the World Bank’s intervention, with no guarantee of reducing debt by the amounts demanded.

In 1999 at the Cologne Summit, the Group of Seven gave a commitment to a $100,000 million debt condonation. Of course this went no further than the rhetorical pronouncements of the world leaders. Early last year announcements were made on debt reduction for some countries. In fact the figures turned out to be laughable given the magnitude of the levies which increase inexorably. The proof of these unfulfilled promises was the Okinawa Summit, where again empty words were cloaked in solemnity to conceal the evidence. And, just a few hours ago, Liana Cisneros informed me that Mr. Gordon Brown, Chancellor of the Exchequer and President of the IMF decision-making committee, rejected the request of debt campaigners for the World Bank and IMF to condone the debt of the poorest countries. As can be seen, there is little hope for any substantial debt condonation.

International law has made significant contributions in tackling this problem from a different perspective. Briefly we could point to the thesis sustained by Dr. Kunibert Raffer, who posits the possibility of creating an insolvency procedure similar to that used in the U.S. (4). Dr. Pier?ngelo Catalano has researched into academic and parliamentary evidence and concludes by condemning the debt as usurious and shameful. It is based on the fraudulent machinations of creditors, condemned in Roman Law especially in the Justinian Code and of course is condemned in Catholic doctrine (5), Also noteworthy are the reflections of Dr. Andr? Franco Montoro, who gathered important legal antecedents on the question (6) and the doctrine of my compatriot, current Ambassador for Argentina in Switzerland, Dr. Miguel Angel Espeche Gil. In 1989 he said the International Court of Justice should be asked for a consultative opinion on the illegality of unilateral modification of the debt interest rates ( 7).

Study meetings have been held too: The 1991 Vienna Scientific Forum, The Rome-Universidad Laterense Seminar in March 1992; The Seminar “Foreign Debt – General Legal Principles – International Court of Justice, Rome Sant’Agata dei Goti, 25-27 May l995; VI Colloquium Latin America –Europe, in Madrid 24 – 25 June 1996; the continental encounter “End of the Millennium and the Foreign Debt” organised by the Latin-American Parliament, in Caracas in July 1997; and finally the 1999 Interparliamentary Conference, held in Windhoek, Namibia 6 – 11 April 1999 where an important document was adopted with recommendations that were never put into practise.

While good intentions have been always present, and the objective of the meetings has been to find some solution, the legal sphere has not moved beyond academic discussion and the parliamentary attempts have not gone beyond political discussion. (8) Peoples’ tribunals have been set up in different parts of the world putting the debt on trial and making moral and ethical condemnations that sadly, have had little repercussion and less concrete result. (9)

It may be that my judgements of the variegated activities on the debt will been seen as overly harsh. I feel however I must stress that this whole process will not end here. Rather, we are setting out on a fresh path where the law acts as the lynchpin for concrete actions we should develop from hereon.

A ruling on Argentina’s foreign debt
In July 2000 in Argentina, Criminal and Federal Correctional Judge Dr. Jorge Ballestero, sent down a ruling on the foreign debt, establishing responsibility of the civil servants of the dictatorship that contracted it and co-responsibility of the international organisations like the IMF, who approved illegal and fraudulent loans and where the decision-making power is granted discretionally to the banks. I attach a diskette, with a full copy of the ruling, so those interested can look closer at this judgement which has no precedent elsewhere in the world. It will be of inestimable value in establishing beyond any doubt that the creditors were responsible for the debt and the ways it was used. On this, Patricia Adams, a specialist in odious debt, and author of “Odious Debt: Loose Lending, Corruption and the Third World’s Environmental Legacy” has pointed out: “The Argentinean Federal Court Ruling on the illegitimacy of debts contracted during the dictatorial period is important. The implications of this ruling extend beyond Argentina and send a clear message to the citizens of all the highly indebted countries that international creditors were responsible for ensuring that the money loaned was not used for the interests and needs of the state. If the creditors did not fulfil this aim then their complaints to citizens lack legitimacy. In this sense this legal ruling from Argentina has served as an important precedent for a future solution of the global debt crisis” ( 10).

The ruling was made in a court case, on which my father worked alone, in the face of the most formidable difficulties, commencing on 4 April 1982, during the military dictatorship. At the trial – and I will not relate detail here given the time allocated for this type of paper – it was demonstrated beyond any doubt that:

1.- Argentina’s foreign debt has no economic, financial or administrative justification.. 2.- The acts of indebtment were legal and illegal acts can not engender legitimate obligations. 3.- The destination of the funds is unknown. 4.- Legislation on territorial competence was modified so that controversies be put to the Courts in London and New York, placing in the creditor’s hands the solution of any conflict. 5.- Most credit operations were carried out in totally clandestine conditions with no accountability.

The Federal Judge communicated his decision to Parliament, so it could take charge of the national debt in consonance with the role assigned by the National Constitution. As occurred in 1984 and 1985, the Argentinean Congress refused to intervene on the subject under pressure from foreign creditors, and the commitments assumed by the Executive Branch vis-?-vis the international credit organisations.

Some aspects of the new legal investigation
While the ruling of the Federal Judge refers specifically to the period of the military dictatorship (1976-1983) it has provided the bases for research being carried out via a new case (11) where are all the refinancing of the original debt until today is examined. In this indictment, in which I have played the part of plaintiff, important evidence has come to light that have determined:

1.- That all the credit the Argentine government has requested from the IMF, World Bank and foreign private banks, has just been to refinance this debt already declared illicit . 2.- That the 1992 Financial Plan for Argentina, because of the question of currency convertibility was drawn up not by the government but by J.P. Morgan, brought in especially for the job. 3.- That Argentina’s public debt was administered for several years by a committee of foreign banks headed by City Bank.

4.- That the private debt, assumed by the state, was also administered by a committee of foreign banks headed by City Bank and made up of Bank of America National Trust and Saving Association, The Bank of Tokyo, The Chase Manhattan Bank, Chemical Banking Corporation, Credit Lyonais, Credit Suisse, Dresdner Bank, Lloyds Bank, Midland Bank, Morgan Guaranty Trust, Royal Bank of. Canada, The Sanwa Bank. These banks decided the exact amounts of the debt and the way in which it would be paid, all of which had the blessing of the IMF, the World Bank, and the Inter American Development Bank. 5.- That a foreign company, Price Waterhouse Cooper, were hired to consult on debt relief, undermining the state supervisory role. 6.- That the investigation carried out by a team of inspectors from the Argentine Central Bank that established the illegitimacy of the bulk of the private debt, was filed, on orders of the bank authorities in 1988. One of those taking this decision was Dr. Daniel Marx, who was Director of the Bank in 1988 and today is Secretary of Finances.

With this new case, the whole process of indebtedness has been clarified as well as the involvement of the foreign banks in it, which means they have an inevitable responsibility. We should also not forget the supervision carried out by the IMF and the members of the Paris Club who oversaw all these procedures.

In the investigation currently underway, the machinery used for capital flight have also come to light. In the case of Argentina it was more than $120,000 million, only possible with the complicity of the foreign banks. That is occurring via a federal court investigation, which albeit slowly has established the forms of fraud and illicitness. These are simply some of the points that have appeared, and which are being more thoroughly investigated.

There is also evidence for denunciations of fiscal fraud that were never investigated, and we are working to identify the exact amounts of private debt that the Argentine State took on. I know this is a long and rocky road but I also believe that it is the only way that the legal machinery can oblige the authorities of this nation to modify their debt policies.

Some practical considerations
How important is a court case? And what about the enormous gap that exists with actions carried out elsewhere in seminars, meetings, peoples’ tribunals, and other legitimate ways of considering the issue? I will answer this question and I think it needs to be discussed.

In meetings held all around the world, some mentioned above, while the debt question was analysed from diverse angles, and final reports laid out various courses of action, unfortunately these have not translated into effective action to deal with the problem. There is a huge amount of by-now-familiar documentation that merely expresses wish lists, or rails against the debt, or perhaps furnishes precise diagnosis of its meaning. There are very scientific legal arguments, that to date have not worked because the only way to confront the power of the creditors is with concrete measures that can substantially alter the situation. An example of this are the academic meetings, aiming for a consultative opinion from the International Court of Justice, which have not advanced beyond theoretical discussion, although that should not belittle the significant contributions made to the doctrine on indebtedness.

In Argentina a legal precedent was put forward which serves as the solid basis of a suit which not only proceeds in the courts but will continue in the arena of international law, if the government refuses to accept the magistrates’ conclusions. A legal ruling sets a precedent to wield against the creditors, that they can not demand what is demonstrably illegitimate, and obliges a government to proceed in accordance with the magistrates’ judgement. They may of course not do so because of pressure from the banks and multilateral credit organisations. In fact in Argentina the ruling has been tacitly repudiated, because it refers to the dictatorship period. But the new case, currently underway, analyses the debt to date and the judge’s conclusions will have to be complied with. If the decision is repudiated, any citizen affected by violation of the stated law is entitled to recur in the Latin American case to the InterAmerican Human Rights Commission, which is the preliminary stage before approaching the Inter American Court, created via the San Jose Pact, in Costa Rica. In fact this legal stage is obligatory for governments in the light of standards of international law, and there is no possibility of its being violated with impunity.

We must perforce accept, that this whole procedure is for now limited to Latin America. However undoubtedly a resolution on illegitimacy from the Inter American Court would leave the United Nations absolutely obliged to submit the matter to the International Court of Justice at the Hague, and thus all the Sub-Saharan African countries, whose debt has acquired scandalous proportions could count upon a procedure in international law to oppose the power of the creditor banks. Here I think I should point out, that a concern on the matter has been already suggested in the U.N. On 17 April 1998 the Human Rights meeting in Geneva, underscored in point 9: a) The negative effects of the debt and policies adopted on it, for full enjoyment of economic, social and cultural rights in the developing countries and; b) That measures should be adopted by governments, the private sector and international financial institutions to palliate these effects in the developing countries and especially in the excessively indebted ones.

This statement took the problem on board without tackling it from the angle of being illicit and this was because, excepting academic discussions, that established the legal parameters of the terms of this illicitness, no country, no non-governmental organisation, not a single citizen suggested the possibility of a concrete investigation that would demonstrate beyond any doubt, how this enslaving burden operates. That is precisely what we must do now in each of our countries: a joint labour leading to a massive international initiative repudiating the ILICIT DEBT. It must be done in the legal sphere, that is that the law courts of each country undertake an investigation of how the process of indebtedness occurred, highlighting the perverse mechanisms used by financial power to twist the economic system to its will. This investigation needs to be with no holds barred.

If in Argentina the most important transnational banks used the procedures that are described in the legal investigation, the background information we have shows us that they behaved in the same way in all the indebted countries. Now is the time to expose this and no further delay should be tolerated. This also means investigating the performance of the multilateral lending bodies which in most cases supported this system, thus being involved and sharing responsibility for policies implemented by the indebted countries. The American Association of Jurists’ view is that “the origin of much of the debt is totally or partially illicit, some loans were fictitious and only served to conceal irregular financial operations, carried out by common agreement between international banks and individuals and companies that in this way built up enormous assets abroad” (12 )

Further to carrying out a legal investigation, the need to question the meaning of the illicit unilateral increase in debt interest rates in consonance with the so-called “Rome formula” drawn up by the Special Commission convened by the European Council for Social Investigation in Latin America (CEISAL) in July 1992, that prepared a 5-point report for the United Nations to present to the International Court of Justice which asks:

1) Does condemnation of usury, constitute one of the general principles of law mentioned in point 1c of art. 38 of the statute of the International Court of Justice? 2) If the answer is affirmative are the unilateral foreign debt interest rate increases acts of abuse of the law and usurious? 3) If the answer to the above two questions is affirmative, are the creditor countries obliged to ensure that these illicit acts are not committed against the debtor countries? 4) If the answers to all three questions above is affirmative, then must not the International Monetary Fund and the World Bank, act in consonance with those obligations of the creditor countries? 5) There exists the parallel obligation upon creditor countries, based on conventional international law, to not permit that acts of usury be exercised against the debtor countries.

Quite certainly this exercise is an imperative we must shoulder. Theoretical abstractions are no use here. I think the following reflections from an important U.S. source are pertinent because they highlight the usefulness of concrete legal actions for recalling historic facts and the need to commence the struggle without further ado: “the world was less concerned with the authentic voice of the Latin American poets than with the strident tone of its lawyers. The Latin American lawyers inherited the constitutional legalist tradition elaborated by the theologians and jurists of the XVI and XVII centuries. In different ways these lawyers challenged the political and economic preponderance of foreign interests, particularly those of the United States. In 1895, Secretary of State Richard Olney had boasted that the United States was practically “sovereign in the continent” – a pretension that Great Britain came to admit in practice, if not in theory; the European states maintained that they could use force and intervene – as in Nicaragua- to recover their debts and protect their nationals from unstable and corrupt regimes, using and abusing the doctrine of extraterritoriality. Between 1868 and 1896 the Argentine lawyer Carlos Calvo developed and defended an extreme version of national sovereignty: foreign interests must be unconditionally subject to domestic laws, discarding European notions of the sacredness of contract. States should act according to their interests as they perceive them even if this be unilateral disregard of debts. The Calvo doctrine became the war cry of Latin American nationalists. As Robert Freeman Smith notes, it was the classic debate between debtors and creditors, the developed and underdeveloped, the weak and the strong (13). That is, the struggle for right, as I hering would have it, is not an senseless exercise or the utopian expression of idealists in the cabinet, but rather shows us a valid alternative to break with the slavery of the debt via undoubtedly effective legal mechanisms that can reveal the secret workings of this huge deceit.

I should stress that Dr. Carlos Calvo was hired by the government of the Republic of Paraguay, in a serious conflict with the British government in 1859. The latter took military and diplomatic retaliation against this diminutive South American country. By linking the doctrine of the great jurists, Calvo opposed the British pretensions and in a truly titanic enterprise obtained recognition of Paraguay’s sovereign rights, and the unreasonable nature of the actions pursued hitherto.

Our proposal
For all of the above, and responding to the generous invitation of the Malian National Jubilee 3000 Coalition that I wish to propose the following.

1.- The construction of an international movement, composed of all the indebted countries with functional autonomy in each, but whose actions are devoted to one common project. 2.- The setting up of a Management council, to represent the movement, composed of all the debtor nations. 3.- That the already constituted organisations and individuals working on the debt in independent organisations like Jubilee 2000, start requesting investigation of the foreign debt in each of the indebted countries, along the lines of the investigation carried out in Argentina. This would furnish us with legal pronouncements that would be obligatory for governments, and if they were repudiated it would entitle each country to recur to international human rights organisations in the face of flagrant violation of the law. 4.- To Constitute a Co-ordinating Committee for Consultancy and Supervision on the legal actions to be taken that would have the mission of orientating the representations to be made, suggesting means of proof, inputting documentation needed in the investigation, and carrying out each and every one of the actions necessary for achieving the best result in the Federal Courts approached. 5.- To gather a team of independent experts in each country with the aim of holding audits to verify the legitimacy of the loan operations that led to the debt and the legality of the clauses contained in the different contracts (interest rate, commission, expenses, extraterritorial jurisdiction pacts, etc.) as a substantial contribution to the work carried out by the various courts that intervene and without prejudice to what they investigate in each case. 6.- Establish forms of regular contact via email, creating an on-going forum for discussion and study for analysis and solution of all the possibilities presented in the course of the investigations mentioned in point 3. 7.- Fix tentative dates for all the project participants to meet, or if not possible, establish a meeting calendar to evaluate progress.

As regards these proposals, I wish on behalf of myself and the Argentina working group, to offer our unconditional collaboration with all the movements represented here, on the basis of our own experience in legal investigations and that our country is the only one where this singular experience has been essayed, and with which we continue to help define the best course of action.

Carrying out the concrete legal actions we propose via each country’s federal courts, something not explored to date, will inject new life blood into an old doctrine on odious or illegitimate debt, propounded in the last century by Professor Alexander Nahum Sack, who was Minister under the Czars of Russia, and Professor of Law in Paris. He maintained that “odious debt contracted and used for reasons which the creditors know are contrary to the interests of the nation, do not commit the latter, except to the extent that it has obtained real advantage from the debt. The creditors have committed a hostile act against the people…” “We can also include in this category debt contracted by members of the government or persons or groups associated with it to serve manifestly personal interests, interests not related to the interests of the state (14). These considerations are still valid, thus in 1982, the legal advisors of First National Bank of Chicago, wrote: “the consequences for the credit agreements of a change in sovereignty depend in part on the use of the funds by the predecessor state. If the debt of the predecessor is termed odious, i.e. that it was not used in the interests of the population, the debt can not fall to the successor”(15) Words that are astonishingly contemporary and which provide us with substantive arguments in the struggle we must now enter. It is not up to us here to make ethical or moral proposals, which albeit legitimate will be hard for the financial organisations to accept. Rather we need to turn to substantive law and the legal realities that govern relations between states and between states and private creditors. The big banks and financial holdings are so powerful in the current scheme of things that they regularly use all the legal resources at their disposal and also recur to other unconventional but effective procedures to refute any type of government control (16). Their selective use of the law in defence of their continual and arbitrary speculation is quite paradoxical. The debtors are denied legal rights and invariably are obliged to submit to the workings of the market, that is of course always to their detriment. The argument is sophisticated but the underlying reality is to invariably accept the conventional economic situation.

An Argentine jurist, commenting on the ruling on the Argentine debt a few days ago said that there is something “that in Argentina and in other countries of the continent there has been an selfish evasion, and that is the most peculiar legal entity of the presumed debtor. The State in virtue of its ends, the public good or common good has a higher ranking that any person in human society. This higher position derives from the nature of its finality, i.e. that it is constituted for the highest good, the supreme good, which outranks and subordinates all others in the community. At the service of the public, of all of its citizens, the entire population, can not be comparable to any individual aim however respectable it appear, much less the private gain of the commercial lending societies, that is the banks. In other words, in the public debt there is an essential inequality. Creditor and debtor do not meet on the same plane, nor have the same entity, nor the same authority. From here derives what they have tried to hide all these years. The State is a sovereign entity and one of the conditions proper to any sovereignty is that no executive procedure may be initiated or fulfilled against it, because that would compromise its very existence and would undercut the independence and action of the respective government (17). Here we have the historic back-up of the Calvo Doctrine and Drago Doctrine, both taken up and extended by eminent jurists like Feraud-Giraud, honorary member of the Institute of International Law and honorary president of the Appeals Court (Cour de Casation) in France, and Dr. Pasquale Fiori, titular member of the same Institute and eminent Professor of the University of Naples which in the last century gave us a doctrine that urgently needs updating to the benefit of our peoples.

To end this overly long presentation, I must recall once more that we have an important corpus of legal doctrine that needs to be put into practice straightaway. Effective at other historical moments, it can also serve in this current struggle. We already have the concrete step of the Argentine investigation that we have to build on, by making spotless presentations in every country which will lead to:

a) Investigation of the different processes of indebtedness, whether the contracts were licit or not, and whether the successive refinancing were legitimate, b) investigate the debts contracted by individual debtors, so as to exclude the state from responsibility when in fact they have been the only beneficiaries; c) put forward the Rebus Sic Stantibus principle, whereby the obligation is cancelled and the debtor released when its fulfilment is impossible, very onerous, or essentially different from when the debt was contracted. d) Investigate the responsibility of the international organisations.

In this latter case, establish what responsibility the IMF and World Bank had in ratifying illicit operations, via supervision exercised through the refinancing arrangements of debts considered illegitimate. (18)

The aim of this meeting
I believe the time has come for us to work together to find common alternatives, and define courses of action to end this terrible scourge. This meeting, made possible by the generous hospitality of our African brothers and sisters, should not just be yet another meeting of organisations from various continents and nations, but must really be a watershed in the struggle against the debt. From here must sail out clear proposals about what we are to do with the stalwart conviction that our union in the project to be carried out will be a formidable tool to free us from a slavery that should be destroyed once and for all.

In these pages I have indicated several examples of solid legal doctrines that will duly root what we resolve to do, and I also tried to briefly explain how the court case in my country worked and how it may serve us all as a tangible precedent to trigger similar actions to those mentioned in my proposal.

Our people can not continue to wait; our conscience, solidarity and humanity calls us to meet the challenge awaiting us right now.

Buenos Aires, 19 April 2000

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