Friday, February 05, 2010

US Lawmakers call for Haitian debt forgiveness

97 US lawmakers signed a letter to ask the G-7 to forgive Haiti's debt. The finance ministers of G-7 countries are about to gather in Canada. The letter was sent to ahead of the meetings to hopefully force Haiti debt forgiveness onto the agenda.

California Democratic Congresswoman Maxine Waters and Florida Republican Ileana Ros-Lehtinen led the letter writing campaign. The two are also involved in legislation efforts on Haiti's debt along with Connecticut Democratic Senator Christopher Dodd and Indiana Republican Richard Lugar.

From IPS, reporter Jim Lobe talks about the letter's request and details the amount of Haitian debt. Debt forgiveness organization Jubille USA also wrote a blog post about the effort.

On the eve of Friday's meeting by G7 finance ministers in Iqaluit, Canada, 94 members of the House of Representatives sent a letter to Treasury Secretary Timothy Geithner that also called for "the provision of assistance to Haiti in the form of grants so that the country does not accumulate additional debts."

That call was echoed by a several non-governmental organisations (NGOs), including Oxfam, Jubilee USA, and Avaaz, which said they plan to deliver hundreds of thousands of individual signatures on petitions appealing for debt cancellation from across the world to this weekend's ministerial meeting.

The push on the G7, which, in addition to the U.S., includes Canada, France, Britain, Germany, Italy, Japan, and the European Union (EU), comes as Haiti struggles to clean up and begin recovering from the cataclysmic Jan. 12 earthquake that is estimated to have killed at least 150,000 people, and possibly tens of thousands more.

In addition to damaging much of the country's infrastructure, the quake, the most lethal in the Americas' recorded history, also rendered nearly one million of its nearly 10 million people homeless, creating unprecedented challenges for the government of President Rene Preval, humanitarian NGOs and foreign aid groups, and more than 10,000 U.S. troops and U.N. peacekeepers.

Last June, 1.2 billion dollars in Haiti's external debt, including that owed to the Washington-based International Monetary Fund (IMF), World Bank, and Inter-American Development Bank (IDB), was cancelled after the Preval government completed a three-year Heavily Indebted Poor Countries (HIPC) programme.

Over half of that debt had been incurred by Haiti's dictatorships, notably the Duvalier dynasty that ruled the country from 1957 to 1986.

But the cancellation covered debt incurred by Haiti only through 2004. In the last five years, the country has received new loans – some of them to help it recover from the floods and other hurricane damage – totalling another 1.05 billion dollars.

Some two-thirds of that total is owed to multilateral agencies, including some 447 million dollars to the IDB, 39 million dollars to the World Bank, and some 165 million dollars to the IMF.

The remainder is bilateral debt, most of it owed to Taiwan (92 million dollars) and Venezuela (167 million dollars). Haiti also owes the Rome-based International Fund for Agricultural Development (IFAD) another 58 million dollars.

While the terms of the multilateral loans are concessional – most of them carry only nominal interest rates and can be repaid over as much as 50 years - servicing of the IMF and IDB loans by themselves alone would normally require Haiti to pay more than 100 million dollars over the next decade, a sum that it can ill afford in the wake of last month's earthquake, according to the NGOs.

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