At their most recent meeting in London, England on February 4-5, the G-7 Finance Ministers agreed in principle to 'provide as much as 100% multilateral debt relief' and asked IMF Managing Director Rodrigo de Rato to bring proposals on how to finance debt cancellation (including using IMF gold) for discussion at the April 16-17 spring meetings of the IMF and World Bank in Washington.

Jubilee USA Network is encouraged that for the first time our own government and the G-7 have officially embraced the call for as much as 100% multilateral debt cancellation, a long-time demand of the Network. We insist however that current discussions must lead to actual cancellation — not just debt service relief; that cancellation apply to all impoverished countries; and that it come without harmful economic conditions. Jubilee USA Network will redouble its campaigns to pressure the US and other G-7 governments to see these commitments turned into action in the coming months. The Network calls on the US government and G-7 leaders to come to a deal on debt cancellation by the April 16-17 meetings of the IMF/World Bank in Washington, DC.

Jubilee USA Network identified several key benchmarks that must be addressed as discussions on multilateral debt cancellation proceed leading into the April meetings, including:

1. 100% cancellation. There must be full (100%) debt stock cancellation for impoverished nations. Proposals put forward by the UK and Canada would not cancel debt stock, but only relieve debt service payments for 10 years.

2. Leave no country behind. The G-7 communiqué indicates that there "will be a case-by-case analysis of HIPC countries" for consideration for 100% cancellation. It is critical that debt cancellation apply to all impoverished nations, not simply those that qualify for the IMF/World Bank's HIPC Initiative.

3. No economic conditions on debt cancellation. Debt cancellation must come without externally imposed economic conditions on impoverished nations. These so-called "structural adjustment" conditions have failed to increase growth and have exacerbated poverty in developing nations and must be immediately ceased. Moreover, Jubilee USA Network calls for debt cancellation to come outside of the HIPC Initiative, which has clearly failed to achieve its goals. Civil society in impoverished nations must be empowered to ensure accountability in the use of funds released by debt cancellation.

4. IMF/World Bank Must Pay Their Fair Share. The IMF can responsibly sell gold and raise more than $35 billion to finance cancellation of IMF and World Bank debt. The World Bank can mobilize at least $17 billion in accumulated and future profits for debt cancellation. These sources of finance must be tapped if there are to be enough resources to extend cancellation to a broad range of countries. Moreover, we support calls by the US government to use resources from the harmful Poverty Reduction and Growth Facility (PRGF) to finance debt cancellation, and urge nations that are able to voluntarily contribute to the costs of debt cancellation to do so.

Jubilee USA Network is pleased to announce the introduction of the bi-partisan JUBILEE Act (HR 1130) into the House of Representatives. The bill, with initial co-sponsors Rep. Maxine Waters (D-CA), Rep. Jim Leach (R-IA), Rep. Spencer Bachus (R-AL), Rep. Carolyn Maloney (D-NY), Rep. Barney Frank (D-MA), and Rep. Barbara Lee (D-CA), was introduced on March 4, and calls for the US Treasury to support 100% multilateral debt cancellation for 50 nations, without harmful economic conditions. Jubilee USA Network is working to generate additional support for the bill in the House of Representatives and plans to introduce a Senate version as well.

Debt of Tsunami-Affected Countries

Though encouraged by the developments on multilateral debts owed by impoverished nations, Jubilee USA Network characterized the US government's and other G-7 nations responses to calls for debt cancellation for nations affected by the Tsunami — a moratorium on some debt payments for one year -- as "completely inadequate." Jubilee USA Network notes with great concern that the moratorium does not cover multilateral debt. Nations affected by the Tsunami need debt cancellation, not just a temporary moratorium.

Jubilee USA Network further notes that action by the G-8 on impoverished country debt in 2005 in the manner described above would provide an important first step towards the Jubilee vision of a world where external debt no longer diverts resources from impoverished people or constrains policy choices. Jubilee USA Network will continue to work for debt cancellation for countries not included in this year's initiative (such as middle income countries with large impoverished populations and those with odious/illegitimate debts) in the years ahead.

For more information, contact: Neil Watkins, National Coordinator, Jubilee USA Network at 202-783-0129 / 202-421-1023. Website: www.jubileeusa.org. ###

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