Jubilee 2000 musters support against debt
by Diego Cevallos
Mexico City, Apr 28 -- Jubilee 2000, an international campaign pressing for the cancellation of the foreign debt of the world's poorest nations, is busily mustering the support of governments, social organisations and trade unions in Latin America.
In Latin America, debt servicing swallows over half of the government budget in several countries. The region's overall foreign debt currently stands at $706 billion - 646 billion up from 40 years ago.
According to World Bank statistics, the region shelled out $739 billion toward debt servicing - or 33 billion more than what it owes today - from 1982 to 1996 alone.
But far from relaxing, the conditions governing payments are getting more and more tough.
"It is a grave problem that must be resolved before the turn of the century," Liana Cisneros, Jubilee 2000 coordinator for Latin America, told IPS. "That is our aim, and there is enthusiasm in many countries worldwide."
Since January, delegates of the London-based group created in 1996 by churches, trade unions and non-governmental organisations (NGOs) from throughout the world have been visiting countries and making contacts in Latin America, encouraging activism and discussions, and advising governments strangled by debt.
Cisneros visited Mexico and Brazil this month. She plans to head to Ecuador in May, and later to Peru.
The group's aim is to draw support for the cancellation, by the end of the century, of the debts owed by the Highly Indebted Poor Countries (HIPC) - a category for which 41, mainly African, countries qualify.
Mexico is one of the most highly indebted countries in Latin America.
Mexico's foreign debt stands at more than $161 billion, 181% higher than in the early 1980s, when the country declared a moratorium on payments. The current debt is equivalent to 40.3% of the gross domestic product of 1998, according to a report released by the Finance Secretariat this week.
Today, each of Mexico's 96 million inhabitants owes $1,608, 96.3% higher than the 1980 figure.
Argentina, meanwhile, the second largest Spanish-speaking country in the Americas, owes over $139 billion, according to the latest data released by the Economy Ministry - a figure 127% up from the total in 1991, when the current economic stabilisation plan was adopted.
Like in Mexico, the Southern Cone country's debt represents 40% of gross domestic product.
But while the British weekly 'The Economist' ranked Argentina, Brazil and Mexico among the 15 emerging economies with the worst debt:exports ratios, it is small, impoverished countries like Honduras, Nicaragua, Bolivia and Guyana - whose combined debts total around 17 billion, according to World Bank data - that are in the biggest trouble.
"The idea is to achieve cancellation of debt for some countries, and rescheduling of payments for others. Overall what we are seeking with the support of society is a review of the global financial system," said Cisneros.
Jubilee 2000, which has the support of the Roman Catholic Church, and has been joined by personalities like legendary U.S. heavyweight boxing champion Mohamed Ali, the members of the Irish rock group U2 and popular British singer Bob Geldof, is inspired by Leviticus in the Bible.
According to the Bible, the year of Jubilee or grace occurs every 50 years, and is an occasion for eliminating social inequities, setting slaves free, returning land to the original owners and wiping out debts.
Jubilee 2000 is presently working in 53 countries with a wide range of NGOs and trade unions, as well as a number of governments, such as the administration of Carlos Flores in Honduras, where the group launched its official campaign against foreign debt in Latin America in January.
Cisneros explained that Jubilee 2000 planned to gather 22 million signatures in favour of the write-off of foreign debt, to be submitted to the members of the Group of Seven richest countries (G-7) plus Russia at their Jun 19 meeting in Germany.
G-7 partners Canada and France have already come out in favour of writing off the debts of some nations.
In 1996, World Bank and International Monetary Fund spokespersons also pronounced themselves in favour of cancelling the debts of the world's poorest countries. However, that initiative has not yet taken shape.
In its 1997 social development report, the United Nations Development Programme (UNDP) underlined that if the debts of the world's 20 poorest nations were cancelled and that money invested in health, the lives of seven million children a year could be saved. The World Bank has acknowledged that for every dollar of aid donated to developing countries, nine return to creditors in the form of debt servicing, Cisneros pointed out.
Heinz Dieterich at the Metropolitan University of Mexico said the foreign debt of countries of the developing South "has turned into a timebomb.
"Unresolved since its origins in the 1960s, the debt is reaching unpayable extremes for the majority of African, Latin American and Asian countries at the end of the millennium," he stressed. (IPS)
The above article by the Inter Press Service appeared in the South-North Development Monitor(SUNS).
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