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NGO's call for cancellation of all Haiti's Debt
Jubilee Debt Campaign calls for full cancellation of all of Haiti’s debt and large assistance grants
We call on the British government to work for full cancellation of Haiti’s entire debt stock and to ensure that large-scale grant funding is made available for the country to help it recover from the earthquake that hit the country this week. We fear this earthquake will erase much of the progress the country has made in the fight against poverty and economic injustice.
We are particularly concerned that the International Monetary Fund has proposed $100 million in new lending to Haiti . While Haiti certainly needs emergency funding, it is completely inappropriate to extend this funding in the form of loans with conditionality attached. We urge the British government to push for this money to be provided through an alternative development source as grant-aid.
Haiti’s dire poverty has been built on centuries of injustice perpetrated against the country by the rich world. The cancellation of two-thirds of Haiti’s debt last year represented one step towards securing a better future for the country. It is imperative that we support Haiti’s efforts to relieve the suffering of its people and rebuild their lives in coming years. To this end we call on the government to push for:
1. Cancellation of Haiti’s debt
While two-thirds of Haiti's debt ($1.2 billion) was cancelled in June 2009 with the support of the international community, the country still has $641 million in debt on its books. This is because debt relief agreements from the IMF and other creditors only covered debts acquired up until 2004. New loans Haiti has received since then have been adding to its debt. Half of this total of $641 million is owed to the InterAmerican Development Bank (IDB) and the IMF. In 2010, Haiti is projected to pay around $10 million to the IMF and IDB - and this is money Haiti simply can't pay now that this tragic earthquake has hit.
2. Massive relief and construction assistance in the form of grants
We are pleased that the British government has committed to $10million for the relief effort. But we are dismayed that the IMF is offering loans, albeit at concessional rates. Even after debt relief, in July 2009 the IMF said Haiti’s risk of debt distress will remain high. Its latest move appears to contradict their own advice.
Not only is lending the wrong solution for Haiti, but the IMF’s loans come with conditions. Current conditions include: raising prices for electricity, refusing pay raises for any public sector employees except those making the minimum wage and keeping inflation as low as possible.
Haiti requires large-scale, condition-free grant-aid as a matter of urgency.
www.jubileedebtcampaign.org.uk
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Jubilee Debt Campaign, 19/01/2010 |
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