Open Newswire

Devastated Nepal Daily Pays $600,000 on Debt
5 days 18 hours ago
Communications

According to the most recent public World Bank figures, Nepal pays $594,000 a day in debt payments as cited by the religious development organization, Jubilee USA Network. World Bank figures report that Nepal owes $3.8 billion in foreign debt and in 2013 paid $217 million in debt payments, or nearly $600,000 a day. Nepal was already one of the world's poorest countries, ranking 145th out of 187 countries listed on the United Nations Human Development Index, before an April 25th earthquake hit the country killing more than 8,000 people. On Tuesday another earthquake of 7.3 magnitude killed more than 100 additional people in the country.

"It's mind-blowing that one of the poorest countries in the world, struggling with earthquake recovery, pays $600,000 a day on debt," said Eric LeCompte, Executive Director of Jubilee USA. "That's $4 million a week that could be going toward recovery and rebuilding."

As Nepal scrambles to rebuild before the approaching Monsoon Season, it finds itself in debt to the tune of $1.5 billion to the World Bank and another $1.5 billion to the Asian Development Bank. The country also owes $133 million to Japan and $101 million to China.

"The World Bank and Asian Development Bank must immediately cancel these debts," stated LeCompte, who serves on United Nations finance expert groups.

Governments Negotiate UN Agreement on Global Development
1 week 18 hours ago
Communications

IMF's Lagarde and World Leaders Will Attend Historic Ethiopia Summit

The United Nations, International Monetary Fund (IMF), World Bank and finance ministries are meeting in New York to finalize an agreement for the Financing for Development Conference (FfD) to be held in Addis Ababa, Ethiopia, in July. The summit seeks to tackle global poverty and features the IMF's Christine Lagarde, heads of state, business leaders and humanitarian groups such as Jubilee USA Network. Pope Francis has committed to attend the Sustainable Development Goals Conference to follow up on the commitments from the Financing for Development process.

"These negotiations are critical for billions of people living in poverty," said Eric LeCompte, executive director of the religious development organization, Jubilee USA Network. LeCompte and Jubilee USA are involved in negotiating the FfD outcome document. "This is a rare opportunity to create a binding global plan to drastically diminish poverty in our lifetime."

This summer's conference is the third Financing for Development summit. The first summit was held in 2002 in Monterrey, Mexico. It produced the "Monterrey Consensus," which laid out six areas of development financing. The 2008 summit in Doha, Qatar, led to commitments from developed nations to continue aid to developing nations and to address a number of systemic global economic concerns that contribute to global poverty such as debt, trade and tax issues. As the United Nations Millennium Development Goals expire, current negotiations continue to focus on these "systemic" issues in the form of domestic resource mobilization, or supporting developing countries to raise more revenue in their countries.

World Bank and IMF Announce $1.1 Billion in Debt Relief for Chad
2 weeks 6 days ago
Communications

The International Monetary Fund (IMF) and the World Bank announced $1.1 billion in debt relief for Chad. The money comes through the IMF and World Bank's two major debt relief programs: the Heavily Indebted Poor Country Initiative (HIPC) and the Multilateral Debt Relief Initiative (MDRI). Chad is the 36th country to receive HIPC relief and the first since 2012. Chad is the fourth-least developed country in the world. More than half its population lives in poverty.

"Debt relief for Chad means an investment in education and healthcare," said Eric LeCompte, executive director of the religious debt relief organization Jubilee USA Network, which advocated for the IMF and World Bank debt relief programs. "This is an important way to give Chad's people help."

As of 2013, Chad owed $2.2 billion to foreign lenders and spent over $100 million annually paying off debt. Prior to receiving debt relief, Chad owed around $800 million to the World Bank and $400 million to the African Development Bank. Chad also owes approximately $500 million to other governments. Under the relief plan, Chad receives $18 million in debt relief from the IMF, nearly $600 million from the World Bank and $236 million from the African Development Bank. Thirty-nine countries are eligible for HIPC debt relief. Qualifying countries must meet certain criteria and implement poverty reduction plans. Chad was granted relief even though it didn't meet all criteria. Critics of these plans argue that to qualify for debt relief, countries should not reduce any budget areas that protect vulnerable populations. The three other qualifying countries yet to receive relief are Sudan, Somalia and Eritrea.

Aftershocks Pummel Highly Indebted Nepal: Poor Country Spends 217 Million Annually on Debt Payments
3 weeks 2 days ago
Communications

Severe aftershocks continue to terrorize Nepal which was struck by a 7.8 magnitude earthquake on Saturday. The rising death toll climbed beyond 3,000 people. Nepal is one of the least developed countries in the world, ranking 145th out of 187 countries in the United Nations Human Development Index. According to the World Bank, Nepal owes $3.8 billion in debt to foreign lenders and spent $217 million repaying debt in 2013. Nepal owes approximately $1.5 billion each to the World Bank and the Asian Development Bank and $54 million to the International Monetary Fund (IMF). It owes $133 million to Japan and $101 million to China.

“Nepal is one of the least developed countries in the world and needs immediate financing to recover,” said Eric LeCompte, executive director of the religious development coalition, Jubilee USA Network. "Relieving Nepal's debts not only provides resources now, but can also help the country rebuild."

Nepal is one of 38 countries eligible for assistance from the IMF's new Catastrophe Containment and Relief Trust (CCR). The IMF created the CCR in February to provide debt relief to poor countries impacted by natural disasters or health crises. The new fund canceled nearly $100 million in debt for Ebola-impacted countries. In order to qualify for relief from the new fund after a natural disaster, a country must meet certain criteria. The disaster must destroy more than 25% of the country's "productive capacity," impact one third of its people or cause damage greater than the size of the country's economy. It is not yet known if Nepal will qualify. Of the $54 million Nepal owes the IMF, $10 million is due in 2015 and nearly $13 million is due in 2016.

World Bank Announces Package of Aid and Loans to Ebola-Affected Countries
4 weeks 5 days ago
Communications

As the Spring International Monetary Fund (IMF) and World Bank meetings open, the World Bank announced $650 million of new grants and concessional loans to the countries of Sierra Leone, Guinea and Liberia. About $220 million will be aid in the form of grants and the remainder will be in the form of highly concessional loans. Currently the three countries owe a combined $518 million to the World Bank. Liberia owes $105 million, Guinea $186 million and Sierra Leone $227 million.

“We urge the World Bank Group to consider bolstering their commitments with a new debt relief package for the impacted countries,” said Eric LeCompte, executive director of the religious development coalition, Jubilee USA Network. “We applaud the new aid for the affected countries and hope that the World Bank can come up with some rapid response plan to address this kind of crisis much faster in the future.”

The new financing is through the World Bank's International Development Association (IDA). The IDA determines its lending terms based on the borrowing country's risk of "debt distress." The new IDA financing will be distributed as approximately 50% grants to Sierra Leone and Guinea and 100% as loans to Liberia. The loans will be repaid over 25 to 38 years. In February, the IMF announced $100 million in debt relief for the three West African countries and called on governments to contribute $70 million more. The IMF also set up a new debt relief fund for poor countries struck by natural disasters or health crises.

IMF Reports Debt and Human Crises Drive Uneven Growth
5 weeks 20 hours ago
Communications

Global Stability and Economic Outlook Reports Released

The International Monetary Fund (IMF) released its Global Financial Stability Report, noting "increased financial stability risks" in the global economy. The report notes that large-scale economic shocks are particularly concerning to global stability. It argues that such risks are greatest for countries with high debt levels and that emerging market countries must be prepared for external shocks. Particular concern is raised on the consequences of currency volatility, the shadow financial system and high corporate debt. The report is a follow-up to the IMF's semi-annual World Economic Outlook Report, which noted uneven global growth, particularly among developing economies.

"The IMF recognizes we need global structures to protect us when there's a major crisis," said Eric LeCompte, Executive Director of the religious development organization Jubilee USA Network. "Countries with high debt levels are the most vulnerable to those crises."

The Global Financial Stability Report focuses on the systemic issues that create global economic trends. It notes that debt levels are rising in emerging markets and that increased risks over the past six months are impacting those countries the most. It argues that policy measures are necessary to "contain financial excesses" in global markets and to improve growth.

"The IMF is concerned that inequality persists, especially in the developing world" said LeCompte. "The IMF notes that the key to stability is addressing debt and tax policies that underlie uneven growth."

"No Touch Torture" at West Springs Hospital?
5 weeks 5 days ago
adjustmentdisorder

Complaints of psychiatric abuse are nothing new. Pilgrim State Hospital in New York lost its accreditation over them in the 80’s. No doubt other psych hospitals have as well. It is my understanding that such complaints have usually centered on excessive forced drugging, often ordered by doctors at big hospitals like the one in DC that holds John Hinkley. In some cases the doctors never even saw the patient they ordered drugged. Psychiatric drugs are unpleasant and can be used as tools for chemical restraint, punishment or both. Other complaints have centered on excessive use of physical restraint, people being put in the straight jacket or full sheet for long periods of time, sometime for days, and often left in their own urine and feces for hours. When such abuse comes to light and a single doctor or staff person is responsible that person can lose their license to practice medicine in whatever capacity and in some instances may even face prosecution. If the abuses reflect a pattern of practice within the whole institution it may be closed.

 

Grenada Reaches Debt Deal as Caribbean Mired in Debt Problems
5 weeks 5 days ago
Communications

Grenada agreed to a debt plan with its Caribbean island investors that will result in a 50% reduction in the value of existing Grenada investment bonds. The deal offers investors a portion of future revenues from a government program designed to attract foreign investment. Although the deal addresses about $262 million in debt, the International Monetary Fund (IMF) reports that Grenada's total debt tops $907 million. According to the Central Intelligence Agency, nearly 40% of Grenada's population lives below the poverty line. "Grenada's debt deal is a significant step in the right direction," said Reverend Sean Doggett, a spokesperson for the local Catholic Diocese and a founding member of Grenada's Jubilee Committee. Because of the correlation of debt levels to high poverty rates, Grenada's Jubilee Committee was organized by the Conference of Churches in Grenada to influence debt negotiations between investors, the IMF and the government of Grenada. "The Conference of Churches in Grenada continues to engage in this process and work with its partners in the region."

Other Caribbean islands are also dealing with unsustainable debts or attempting to renegotiate their debt levels. These islands include Antigua and Barbuda, St. Vincent and the Grenadines, St. Lucia, Dominica and Jamaica. Jubilee USA supported Grenada's Jubilee Committee and last year religious leaders across the small islands formed the Caribbean Debt Network (CDN) to join debt negotiations on all islands facing crisis.

Vanuatu Owes Millions in Debt, Struggles to Recover from Monster Cyclone; Religious Coalition Calls for Debt Relief
6 weeks 5 days ago
Communications

The religious anti-poverty organization Jubilee USA Network is calling on international lenders to grant debt relief to Vanuatu. In mid-March, Cyclone Pam struck the string of small Pacific islands with winds up to 165 miles per hour. The category 5 storm destroyed or damaged nearly every building in the capital city and wiped out crops across the country. The United Nations warns that entire islands are facing imminent starvation and its President says the "monster" storm undid the nation's recent economic development. Vanuatu owes approximately $84 million to international lenders, including nearly $10 million to the World Bank.

"The World Bank and other international lenders can reduce Vanuatu's debt," said Eric LeCompte, Jubilee USA Network's Executive Director. "Vanuatu's people will need every single dollar they can get to rebuild."

Greece Proposes Plans to Tackle Tax Evasion and Corruption
7 weeks 13 hours ago
Communications

 Greece submitted a list of economic reforms to the European Union (EU) in an effort to secure emergency financing. The reforms include proposals to raise revenue by curbing tax evasion and corruption. Eurozone leaders rejected a prior Greek reform plan over the weekend. Greek Interior Minister Nikos Voutsis told Germany's Spiegel news magazine that Greece may not make its €450 million payment to the International Monetary Fund (IMF) if it does not receive more financing by April 9. Government spokesperson Gabriel Sakellaridis denied that Greece would forgo IMF payments.

"This is a poker match between Greece, the IMF and the EU," said Eric LeCompte, Executive Director of the religious debt relief organization Jubilee USA Network. "The stakes are high with millions of ordinary people's lives on the table."

Greece's Syriza party vowed to end austerity measures and renegotiate the country's debt after winning national elections in January. The Greek government submitted a list of proposed reform measures in February to unlock a four-month extension to its current loan deal with the EU, IMF and European Central Bank. The EU rejected those proposals and instructed Greece to submit new reforms. Greece is also seeking debt relief and indicated it would pay for domestic services before paying its debt if forced to choose. Greece is the most heavily indebted country in Europe and the third most indebted in the world.

"This ongoing dispute is more evidence that we need a global bankruptcy process with clear rules," said LeCompte, an expert to United Nations finance working groups. "Otherwise we're just gambling with people's lives."​

Senate Budget Action Fails to Repeal Tax Transparency Law
7 weeks 4 days ago
Communications

Budget amendment SA 621, to repeal the Foreign Account Tax Compliance Act (FATCA), failed to reach the the US Senate floor for a vote on Friday. FATCA was originally passed in 2010 to prevent corrupt activities and Americans from evading taxes abroad. The law requires foreign financial institutions to disclose financial information or face penalties.

"It's an unpopular idea to overturn existing tax transparency laws in the Senate," said Eric LeCompte, executive director of the financial reform organization Jubilee USA Network, which generated thousands of phone calls into the Senate in support of FATCA. "The lack of support for repealing FATCA shows how important anti-corruption legislation is to Congress."

Countries and financial institutions that sign FATCA compliance agreements with the US government agree to automatically share certain tax information. To date, over 77,000 banks and 80 countries have signed such agreements. In 2013, G8 leaders pledged to crack down on tax avoidance and improve transparency by working toward a global version of FATCA. The G20 that year agreed to automatically exchange information by the end of 2015 and called such exchange "the new standard." In 2014, 47 countries agreed to a global standard of information exchange developed by the Organization for Economic Cooperation and Development.

FATCA is part of a global campaign for financial transparency," noted LeCompte.

Jubilee USA Network is an alliance of more than 75 US organizations and 400 faith communities working with 50 Jubilee global partners. Jubilee's mission is to build an economy that serves, protects and promotes the participation of the most vulnerable. Jubilee USA has won critical global financial reforms and more than $130 billion in debt relief to benefit the world's poorest people. www.jubileeusa.org

House Sub-Committee Holds Puerto Rico Bankruptcy Hearing; Heavily Indebted US Territory Seeks Chapter 9 Protection
11 weeks 6 days ago
Communications

A US House of Representatives Judiciary sub-committee is discussing legislation to give Puerto Rico's public utilities access to US bankruptcy protection. The Subcommittee on Regulatory Reform, Commercial and Antitrust Law is meeting to debate HR 870, a bill introduced by Puerto Rico's Representative in Congress. Puerto Rico has more than $70 billion in public debt, about $20,000 per resident. The island's government attempted to restructure its public utility company's debts but was stopped by a court ruling. As a territory, Puerto Rico cannot access International Monetary Fund (IMF) loans and isn't eligible for the bankruptcy laws that govern US cities and states.

"Puerto Rico is in a debt trap and this bill could be a way out," noted Eric LeCompte, executive director of the religious anti-poverty group, Jubilee USA Network. "In this case, bankruptcy laws can help, just as a global bankruptcy process could help all countries around the globe."

Some financial firms that hold Puerto Rican bonds oppose the bill. Those funds won a recent court decision to block the island's public utility company's $9 billion debt restructuring. Meanwhile, some hedge funds involved in Puerto Rico have been involved in allegedly predatory behavior elsewhere, including Aurelius Management, one of the lead plaintiffs in the Argentine debt dispute.

"It is troubling that there are predatory hedge funds involved in Puerto Rico," said LeCompte, a United Nations expert on debt and finance. "It's important to note that various predatory funds are on both sides of this battle. It shows that these funds will bend laws in either direction for their own interests."

IMF Plan Offers $170 Million in Debt Relief for Ebola-Impacted West Africa: IMF Debt Facility Can Now Aid World's Poorest Countries During Crises
14 weeks 6 days ago
Communications

The International Monetary Fund (IMF) is providing $330 million of financing to aid Ebola-impacted countries. The plan includes $170 million of debt relief and grant-like aid for Liberia, Sierra Leone and Guinea. The new plan also expands a debt relief facility previously used to cancel debt after Haiti's 2010 earthquake. The new expanded facility, the Catastrophe Containment Relief Trust (CCR), is now a permanent debt relief facility for the world's poorest countries when they experience shocks such as epidemics or natural disasters.

"This aid is so vital for the countries affected by Ebola," said Eric LeCompte, Executive Director of the religious anti-poverty organization Jubilee USA Network. "Now we have a permanent debt relief vehicle for when the poorest countries face certain crises. Essentially, a global social safety net is now in place to protect the least developed countries when they experience disasters."

$100 million of debt relief will come through the IMF's new Catastrophe Containment Relief Trust. Another $70 million in debt relief will come from other governments who hold debt in the three countries. Concessional loans of $160 million add up to a grand total of $330 million in new financing. The package also includes a new financing mechanism designed to deliver funds to disaster-impacted countries quickly without worsening debt burdens.

"This new fund is an important, permanent tool in the fight against poverty," noted LeCompte, who serves on United Nations expert groups on debt and global finance. "It means resources for countries that need them most at the time they need them most."

President Obama Says Greece Needs "Growth Strategy," Criticizes Austerity
15 weeks 2 days ago
Communications

By Sumi Yi

President Obama criticized Greek austerity programs in an interview that aired on CNN on Sunday. The United States President said: “You cannot keep on squeezing countries that are in the midst of depression.” Obama called on all sides to compromise and argued, "when you have an economy that is in a free fall there has to be a growth strategy and not simply the effort to squeeze more and more out of a population that is hurting." His comments follow French Finance Minister Michel Sapin's call for a "new contract" between Greece and Europe. The anti-austerity Syriza party won Greece's elections and is seeking to renegotiate Greek debt. Greece is the third-most indebted country in the world.

"Austerity simply doesn't work," said Eric LeCompte, Executive Director of the religious financial reform organization Jubilee USA. "I think President Obama and French leaders understand there needs to be an alternative."

Mr. Sapin met Sunday with Greece's Finance Minister Yanis Varoufakis and said Europe should review austerity policies within the Eurozone. The French minister said Europe should also discuss Greece's debt situation and he and President Obama both called on Greece to make internal reforms. Greece began a series of austerity measures in 2010 as part of its emergency loan from the European Central Bank, International Monetary Fund and European Union. Since 2010, Greek unemployment doubled and the country lost 400,000 jobs in 2012. The Greek economy contracted every fiscal quarter for five years.

United Nations Commission: Cancel Debt for Ebola-Impacted Countries; West Africa Needs Debt Relief to Address Economic Challenges
15 weeks 5 days ago
Communications

The United Nations Economic Commission for Africa (UNECA) released a report calling for debt cancellation for Ebola-impacted countries. The new report, "A Case for External Debt Cancellation for Ebola-Affected Countries," calls on multilateral institutions and governments to cancel Liberia, Sierra Leone and Guinea's debts. The report argues debt relief would provide necessary "breathing space" to address the region's economic challenges. All three countries are ranked in the bottom 15 in the United Nations' Human Development Index.

 "West Africa needs debt relief," said Eric LeCompte, Executive Director of the debt relief organization Jubilee USA. "Debt relief will not only fight Ebola, it will also provide a long-term investment in healthcare for the countries."

UNECA first called for debt relief in December. In November, the United States government called for $100 million in debt relief and took its plan to the G20. At the request of the G20, the International Monetary Fund (IMF) is currently considering a $300 million financing package that could include debt relief. In January, Guinea President Alpha Conde called for IMF debt relief. Guinea, where the outbreak began, spent more money on debt than on public health in the year before the epidemic began. All three countries have poverty rates above 50%.

"There is growing consensus for action," noted LeCompte, who serves on UN expert groups on debt. "Debt relief can provide additional financing the countries need."