AJWS Calls on Congress to Pass Legislation Canceling Debts Owed by Impoverished Countries

AJWS President Ruth Messinger joins others in fasting for rapid action on debt relief

New York, October 11, 2007 — Urging rapid passage of legislation aimed at providing debt relief to the world’s most impoverished countries, Ruth W. Messinger, President of American Jewish World Service (AJWS), is joining a group of Congress members and other leading activists in a fast today and will be speaking at an October 16 Jubilee USA prayer breakfast on Capitol Hill.

The Jubilee USA Network, an alliance of more than 75 member groups dedicated to the cancellation of debts that cripple impoverished nations around the world, is driving the push to place debt relief at the top of the international agenda. Sub-Saharan African countries, for example, currently pay more than $14 billion in debt service each year—at least twice as much as they receive in aid.

“Funds going from poor countries to well-heeled financial institutions could be used to improve education, provide better healthcare and fund agricultural projects that increase food security for the poorest, ” Messinger said. “Fasting provides us with an opportunity to reflect on our responsibility as privileged citizens of a wealthy nation; we need to take meaningful steps to ensure that our prosperity is not a reward for exploiting developing nations.”

Under current guidelines set by the World Bank, countries seeking to qualify for debt cancellation are often required to take steps that directly and adversely affect their poorest citizens, including privatizing water and electricity services, instituting hiring and salary freezes for healthcare workers and establishing fees for health services.

In June, Rep. Maxine Waters (D-CA) and Rep. Spencer Bachus (R-AL) introduced the Jubilee Act for Responsible Lending and Expanded Debt Cancellation H.R. 2634. The legislation, if passed, would require the Secretary of Treasury to work with the World Bank, International Monetary Fund and the Paris Club of Official Creditors to cancel all debt incurred by low-income countries without imposing harmful economic consequences.

In addition, the bill would require the governments of low-income countries to allocate savings from debt cancellation towards poverty reduction and to engage a cross section of civil society groups in a transparent allocation process that would including producing an annual report outlining how the savings were used. Finally, the bill assures that debt cancellation will not result in the reduction of future aid and it encourages low-income countries to use 20 percent of their national budgets on poverty reduction.

“We are calling on Congress today to help lift these roadblocks to sustained development so countries in Africa, Asia and Latin America can pave their own paths to a more prosperous future,” Messinger said. 
 

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