Jubilee USA welcomes World Bank debt cancellation accord

Jubilee USA

March 30, 2006

Debt relief advocate, Jubilee USA Network, has welcomed approval of debt cancellation by the World Bank Executive Board for some impoverished countries, and urged the Bank to remove deadly delays to debt cancellation for additional impoverished countries.

“While we welcome progress at the World Bank towards debt cancellation as the negotiations have been difficult, we call on the Bank to move quickly to allow additional impoverished countries to see their debts cancelled this year, rather than having to wait until July 2007 – a full two years after the G-8 summit (in Gleneagles, Scotland),” said Neil Watkins, National Coordinator of the Network.

“Under the plan approved today (28 March) by the World Bank`s board, several countries will have to keep making non-refundable debt payments to the World Bank, even after reaching completion point – when they were promised relief. This is unacceptable,” Watkins stressed.

The approval means that 13 heavily indebted poor countries (HIPC) in Africa will have their debts to the International Development Association (IDA) of the World Bank fully cancelled starting on 1 July 2006 when the bank`s new fiscal year begins.

The debt cancellation, which will benefit 17 HIPC countries globally, goes to Benin, Bolivia, Burkina Faso, Ethiopia, Ghana, Guyana, Honduras, Madagascar, Mali, Mozambique, Nicaragua, Niger, Rwanda, Senegal, Tanzania, Uganda and Zambia.

Jubilee USA said many impoverished countries were urgently in need of debt cancellation, citing Malawi where an estimated 5 million people go hungry, according to a recent Washington Post article, and the country`s HIV/AIDS prevalence rate is more than 14 percent.

“Debt service drains money away from social spending and HIV/AIDS drugs. But under the Bank`s proposal, Malawi would wait until July 2007 to see desperately needed relief, more than one year after qualifying (for debt cancellation),” Watkins said.

Fewer than half of those 42 countries made eligible for debt cancellation by the G-8 will see debt cancellation before mid-2007, the Jubilee USA official said in a statement sent to PANA Wednesday.

He noted that the Network will continue to work towards full debt cancellation without harmful economic conditions for more countries including those with odious debts as well as creditors left out of the G-8 debt deal.

Jubilee USA Network is the US arm of the international movement working for debt cancellation for impoverished nations, and is a network of over 75 religious denominations and faith-based, labor and environmental groups, and community and advocacy bodies working for freedom from debt and economic justice for countries in Africa, Asia, and Latin America.

Categories: Africa, Debt Relief, Odious Debts

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