Monday, March 19, 2007

A Call for Cancellation of Haitian Debt

I've just received the following from Haiti Reborn:

For Immediate Release, 16 March 2007

U.S. organizations call on IDB to immediately cancel Haiti’s debt

When the Inter-American Development Bank meets this weekend (March 16-20) in Guatemala City, the agenda will include finalizing a proposal to cancel the debts of five countries: Bolivia, Nicaragua, Honduras, Guyana, and Haiti. All but Haiti are poised to receive immediate cancellation of their debts. However, Haiti may be asked to wait three years or more to receive cancellation because the country has yet to complete the Heavily Indebted Poor Country Initiative (HIPC) of the World Bank and International Monetary Fund.

"Haiti currently pays $56 million a year to service odious debts. A large portion is paid to the IDB – the creditor that makes the largest claim against Haiti. If Haiti has to wait until the end of fiscal year 2010 for cancellation, that is another $90-120 million just to the IDB – money that would be far better spent providing health and education services for the people of Haiti," said Tom Ricker, co-director of the Quixote Center’s Haiti Reborn program.

"Haiti only has 25 doctors per 100,000 people, and the public sector is currently spending $10 per person on health services. With this level of support between now and 2010 another 100,000 children in Haiti will die before reaching 11 months of age, and another 6,000 women will die during childbirth. Canceling Haiti’s debt now could help prevent many of these tragedies," said Nicole Lee, director of the Transafrica Forum.

"Half of Haiti’s debt – nearly 60 percent of the IDB debt – is "odious debt", or loans made to the Duvalier family or other dictatorships. The IFIs knew this "aid" was buying fur coats, financing death squads and propping up repressive regimes, but they kept it flowing. The IDB has an opportunity to make up for this unconscionable policy, and to support Haiti’s democratic government, by cancelling this odious debt," said Brian Concannon, director of the Institute for Justice and Democracy in Haiti.

In November of 2006 the IDB Board of Governors agreed to create a process for canceling the debts of five eligible impoverished countries. After a follow up meeting in Amsterdam in January, it was announced that $3.5 billion in debts would be cancelled. However, little has been said about the process, and what conditions if any would be attached to countries for receiving the cancellation.

"It is egregious that Haiti must comply with harmful economic reforms to obtain debt cancellation from the IDB. This is why senior Members of the U.S. Congress introduced a resolution this week to immediately and completely cancel Haiti’s debt. When thousands of lives are literally at stake I don’t see how the IDB Board of Governors can do anything other than heed Congress’s call," added Tom Ricker.
In addition, U.S. Rep. Maxine Waters (CA-35) has introduced a resolution in the House of Representatives to urge the IMF, the World Bank, the Inter-American Development Bank, and other multilateral financial institutions to cancel Haiti’s multilateral debts immediately and completely. The resolution also urges the Secretary of the Treasury to use the voice, vote and influence of the United States within these institutions to accomplish this important goal. You can read more about this proposal here.

UPDATE: It appears that the Inter-American Development Bank has granted complete debt relief to Bolivia, Honduras, Nicaragua, and Guyana as well as partial debt relief for Haiti. The details on Haiti are as follows:
Haiti, which is part of the International Monetary Fund's Heavily Indebted Poor Countries Initiative, will be able to get rid of $20 million of its debt by 2009, and after that it can shed the entire $525 million.
Based on this report it is not clear why Haiti was not granted immediate debt relief like the other four countries. Likewise, there was no indication as to whether or not the above timeline was contingent upon Haiti meeting certain conditions or requirements.



Post a Comment

Subscribe to Post Comments [Atom]

<< Home