Europe

U.K. urged not to accept debt repayment

Ashley Seager
The Guardian (UK)
December 7, 2005

London: The British Government has drawn sharp criticism from development charities for taking a debt repayment from Nigeria, which dwarfs the U.K.’s entire annual aid budget for the African continent. The Group of Seven leading industrial countries, which met in London over the weekend, are soon to receive $12.4 billion from Africa’s most populous nation as part of a debt rescheduling package agreed this year by the Paris Club of creditor countries. As Britain is Nigeria’s largest creditor, it is set for a windfall of œ1.7 billion in the coming months – considerably larger than the œ1 billion-a-year portion of the European Union rebate that Prime Minister Tony Blair has offered to give up.

Oil revenues The charity, Jubilee Debt Campaign, says the payments mean the G-7 will receive more in six months from Nigeria than the 2005 Gleneagles G-8 deal will provide to poor countries in a decade. The G-8 is the G-7 plus Russia. Trisha Rogers, Jubilee’s director, said: “It is obscene for G-7 countries to take billions of dollars from one of the poorest countries on earth. In particular this means the U.K. will take from Nigeria almost exactly twice as much as it is giving in aid to the whole of Africa in 2005.” She urged Britain, which chairs the G-7, to take the lead in refusing to accept the payments. U.K. Finance Minister Gordon Brown said he thought it fair that Nigeria pay some of its debts given that it had a huge windfall from the doubling of oil prices over the past 18 months. Nigeria is a significant oil producer and a member of the OPEC cartel. Under the terms of the Paris Club deal, Nigeria will see $18 billion of its total of $30 billion cancelled on condition that it pay off the remaining $12.4 billion immediately out of its bumper oil revenues. Half is to be paid in the coming days and the rest in March.

Categories: Europe, Odious Debts, United Kingdom

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