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CONGRESSWOMAN WATERS SAYS DEBT CANCELLATION FOR 18 COUNTRIES IS NOT ENOUGH; 36 CBC MEMBERS URGE THE BUSH ADMINISTRATION TO CANCEL POOR COUNTRY DEBTS

July 30, 2009
Press Release

Last night, Reps. Maxine Waters (D-CA) sent a letter from 36 Congressional Black Caucus (CBC) members to President Bush and Treasury Secretary John Snow, urging them to cancel the debts of poor countries in Africa and throughout the world. The letter coincides with reports of a limited agreement between President Bush and Britain's Prime Minister Tony Blair to cancel the debts of 18 poor countries.

"I was encouraged that President Bush and Prime Minister Blair discussed debt cancellation during their summit meeting, but I am concerned by reports that their agreement cancels the debts of only 18 countries," said Congresswoman Waters. "This agreement would not even cover the 27 countries that are already included in the HIPC Initiative."

The Heavily Indebted Poor Countries (HIPC) Initiative of the IMF and the World Bank provides limited debt relief to 27 poor countries; 23 of them are in Africa, and 4 are in Latin America.

"Our letter urges the President to negotiate an agreement to provide 100% debt cancellation to poor countries in Africa and throughout the world," said Congresswoman Waters. "Our letter requests debt cancellation for all 23 African countries that are included in the HIPC Initiative, as well as countries like South Africa that were not included in the HIPC Initiative."

Earlier this year, Congresswoman Waters introduced H.R. 1130, the JUBILEE Act, a bill to cancel completely the multilateral debts of 50 impoverished countries. The JUBILEE Act is cosponsored by a bipartisan group of 71 Members of Congress.

"I hope that President Bush and Prime Minister Blair will extend the benefits of debt cancellation to all countries that need it," said the Congresswoman.

The text of the letter and the 36 CBC members who signed it follow:

As members of the Congressional Black Caucus (CBC), we are deeply concerned about the overwhelming debts that burden poor countries in Africa and throughout the world. We urge you to negotiate an agreement that provides 100% cancellation of multilateral debts owed by poor countries during the upcoming G-7 Finance Ministers' meeting on June 10-11 and the subsequent G-8 Summit in Gleneagles, Scotland, on July 6-8.

Many poor countries have been unable to eradicate poverty, address the HIV/AIDS crisis, or develop their economies because of the overwhelming burden of multilateral debts. It has been estimated that African countries spend an average of $14 per person on debt service payments to multilateral institutions like the International Monetary Fund (IMF) and the World Bank and less than $5 per person on health care.

The limited debt relief available through the Heavily Indebted Poor Countries (HIPC) Initiative of the IMF and the World Bank has made a difference in the lives of millions of people in poor countries. Uganda used the savings from debt relief to double school enrollment and significantly reduce the HIV infection rate. Mozambique vaccinated half-a-million children, and Tanzania eliminated school fees and built over 31,000 new classrooms. An analysis of the HIPC Initiative by the IMF and the World Bank shows that since 1999, the 23 countries in Africa that received debt relief more than doubled their poverty-reduction expenditures.

Unfortunately, the HIPC Initiative has failed to provide a lasting solution to the poor country debt crisis. Debt service payments for HIPC countries have been reduced by less than one-third, and the 23 African countries that have received debt relief under HIPC still spent over $2 billion on debt service payments last year. Other impoverished countries, like South Africa, were completely excluded from the HIPC Initiative and received no debt relief at all.

We strongly urge you to negotiate an agreement that provides 100% multilateral debt cancellation for poor countries in Africa and throughout the world at the upcoming G-7 Finance Ministers' meeting and the subsequent G-8 Summit. We look forward to your response and to working with you to achieve a historic breakthrough this summer that will cancel poor countries' debts once and for all.

Sincerely,

Maxine Waters
Barbara Lee
Donald Payne
Charles B. Rangel
John Conyers
Bobby Rush
Jesse L. Jackson, Jr.
Gwen Moore
Donna M. Christensen
Eddie Bernice Johnson
Danny K. Davis
Al Green
Julia Carson
Carolyn Kilpatrick
Emanuel Cleaver II
Gregory Meeks
Diane E. Watson
William Lacy Clay
Artur Davis
Cynthia McKinney
John Lewis
G. K. Butterfield
David Scott
Eleanor Holmes Norton
Edolphus Towns
Elijah E. Cummings
Melvin Watt
Chaka Fattah
Major R. Owens
Sanford Bishop
Bennie G. Thompson
Sheila Jackson-Lee
Corrine Brown
Juanita Millender-McDonald
William Jefferson
Kendrick B. Meek

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