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| "Total Debt Cancellation for Poverty Reduction" |
The most commonly asked questions for the Debt Project are answered here. If you have a question that has not been dealt with here, please get in touch with us.
What does Jubilee mean?
The "Jubilee" is a biblical mandate (Leviticus 25, Deuteronomy 15) that was meant to restore the bonds of community broken through injustice, unfair distribution of resources, slavery and deep debt. Every fifty years, lands were redistributed, slaves were freed and debt was cancelled. During the great jubilee year of 2000, religious and civic leaders around the world have called for the cancellation of the debt of the poor countries. This is the "Jubilee 2000" movement, aiming to give billions of poor people a new beginning, a fresh start toward full human development.
What is the justice issue of debt?
When we talk about debt, there are many important justice issues to be considered. First, there is the justice of acquiring the debt -- how fairly was it negotiated, who participated in the decision-making, who really benefitted from the loans? Second, there is the justice of repaying the debt -- how fair are the interest rates, where does the money come from for servicing the debt and how does this affect the social conditions of the people? Third, there is the justice of cancelling the debt -- whose voice is heard loudest in the negotiations -- the poor or the rich, where will the resources go that are freed up through debt cancellation, how accountable and participative is the process of cancellation?
How does it affect us all ?
Firstly, unpayable debt and austerity measures that accompany new
loans can inflame social conflicts that can lead to civil wars and even
genocidal campaigns, as in Rwanda. Many of these conflicts have resulted in costly
humanitarian interventions by the USA and other nations.
Secondly, a large debt burden motivates a lot of poor countries to lower labor standards
as they engage in a desperate struggle to attract foreign investment and thereby earn
enough "hard currency" from export revenues to repay foreign debt. That leads to
lower wages and growing poverty around the world.
Thirdly, countries with major debt burdens are not good customers for foreign products or
attractive places for investment. This is so because unpayable debt
discourages foreign direct investment, stifles consumption and affects commerce. And
lastly, debt harms the environment, encouraging rainforest destruction
and pollution as poor countries use cheap but environmentally destructive ways to earn
export revenues.
Why is debt a problem for the poor?
In order to repay foreign debts, many poor countries are being forced to direct scarce government resources away from health care, education, and other vital services. For instance, Zambia has been spending US$200 million annually on debt servicing, and is likely to be faced with over US$600 million annual debt servicing bills after the year 2000. The result has been to deny many children the chance to go to school, women access to pre-natal care, HIV-infected persons access to counselling and treatment, and small farmers access to credit and technical assistance.
How can we get rid of this debt?
It is not only true that the most poor countries of the world
cannot pay back this debt; but also that they cannot continue servicing it, for it blocks
development. The Heavily Indebted Poor Countries (HIPC) initiative of the World Bank and
the IMF might offer some help, but it is too late (e.g., for Zambia after 2000); too
little (only a portion of the debt is written off the books); too rigid
(eligibility depends upon strict adherence to Structural Adjustment Programmes); too
limited (only 41 countries are declared "eligible"); and too
unrealistic (it doesn't consider social factors)
Therefore, the best plan and most radically effective approach that can be employed would
be an outright cancellation of the debt under the Jubilee 2000 approach.
How can I get involved?
If you are interested in joining the campaign or would like more information, you can:
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