The Jubilee Blog

Nepal Post Earthquake Aid Falls Short of Goals; No Debt Relief Pledged at Nepal Recovery Conference

By Sophia Har 

This week's Nepal donor conference pledged $4.4 billion in aid to Nepal, short of the $6.6 billion Nepal requested for earthquake recovery. About half of the total financing is loans and half is grants. Nepal did not receive any pledges of debt relief while world leaders gathered in Kathmandu. The International Monetary Fund (IMF) said Thursday Nepal will not qualify for its new emergency debt relief trust fund.

"The initial aid pledges are helpful and we can close the $2 billion gap quickly with debt relief," said Eric LeCompte, Executive Director of the religious development organization Jubilee USA Network. "One of the quickest ways that the World Bank, Asian Development Bank and governments can deliver rebuilding grants is by canceling debt."

Nepal spends $600,000 a day paying its debt, or more than $35 million since the first April earthquake.‎

UN ‎Debates Debt and Tax Prior to Historic Development Conference

By Sophia Har 

UN negotiators struggle to find consensus on debt, trade and tax policies on the last day of scheduled negotiations before heads of state, business leaders and development organizations meet for the July Financing for Development (FfD) conference in Addis Ababa, Ethiopia. 

"These meetings offer a rare opportunity to raise needed resources to confront extreme poverty," said Eric LeCompte, executive director of the religious development organization Jubilee USA Network. LeCompte was in New York for the negotiations. "More than a trillion dollars can be raised annually if we win policies that promote responsible lending and curb corruption and tax evasion."

In 2013, developing countries spent $680 billion paying off debt but received just $134 billion in official aid, according to the World Bank and the Organization for Economic Cooperation and Development. A key issue in the FfD debt negotiations is responsible lending and borrowing. The United Nations Conference on Trade and Development developed principles for responsible lending and borrowing that could be endorsed in the final Financing for Development agreement.

"Fast Track" Hurdles and Development Concerns Remain After House Trade Votes

By Sophia Har 

A package of trade bills stalled today when the US House of Representatives defeated
one portion of the package while voting in favor of another. Trade Adjustment Assistance, a program to assist US workers who lose their jobs because of trade agreements, failed by a vote of 302-126. This worker assistance is part of the Trade Act of 2015 which would give President Obama Trade Promotion Authority (TPA) to move international trade agreements through Congress without amendment. Congress must pass trade assistance within two remaining legislative days in order for TPA or "fast track" to be sent to President Obama's desk.

"Whether or not the package passes, Congress can amend harmful arbitration provisions that favor predatory actors over vulnerable people," said Eric LeCompte, executive director of the religious anti-poverty organization Jubilee USA Network.

The House Rules Committee rejected an amendment by Congressman Mark Pocan to prevent Congress from using Trade Promotion Authority to advance trade deals that contain Investor-State Dispute Settlement mechanisms. These mechanisms allow companies to sue countries over disputes related to trade agreements. Predatory financial firms are known to use the tribunals to sue countries in economic distress to collect on debts purchased on the secondary market. In 2013, a Slovakian firm sued Greece, arguing that the country's debt restructuring violated the terms of its investment treaties with Slovakia and Cyprus. On May 22, the Senate defeated a similar amendment to the Senate TPA bill 60-39.

G7 Calls for Greater Global Economic Stability

By Sophia Har 

G7 Heads of State released their annual Declaration
as their summit finished in Bavaria, Germany. The
summit focused on rising debt levels and risks to global economic stability amid geopolitical tension around the world. They call for halting corruption and tax avoidance, reducing debt to more sustainable levels and increased transparency.

"We support the words of the G7 to address tax and debt issues to build a more stable and transparent global economy," stated Eric LeCompte, executive director of the religious anti-poverty coalition Jubilee USA Network. "We now need the G7 to turn those words into action."

G7 leaders discussed Greece's ongoing debt crisis at the summit. Greece is currently in negotiations for emergency funding from the European Union, European Central Bank and International Monetary Fund. It is the most indebted country in Europe.

At G7 Summit Trade and Debt Policies Take Center Stage; Bishops Call on G7 to Enact Global Bankruptcy Process to End Poverty

By Sophia Har

The upcoming G7 summit focuses on global economic issues and conflicts in Ukraine and the Middle East. Pending international trade agreements and ongoing debt crises around the world will dominate the ‎conversation. 

"Debt, tax and trade issues will take center stage at this year's meeting," noted Eric LeCompte, Executive Director of the religious development organization Jubilee USA Network. LeCompte was in Dresden, Germany, for last week's G7 Finance Ministers gathering. "It's right that economic stability is a priority on the agenda. Inequality and poverty drive conflict and instability around the world."

Prior to the summit, G7 Finance Ministers met in Dresden, Germany, to address debt and tax issues. ‎During the finance minister meetings, Jubilee Germany organized a prayer service led by Dresden's religious leaders that German Finance Minister Wolfgang Schäuble attended. The Dresden Catholic Bishop and leading Protestant Bishop called on the G7 to enact a global bankruptcy system for countries to address global
poverty and inequality.

FIFA Scandal Highlights Corruption in Global Financial System

US Banks Named in FIFA Indictment 

 By Sophia Har 

The President of international soccer's governing body, the Federation Internationale de Football Association (FIFA), is resigning amid corruption allegations. Sepp Blatter led FIFA for 17 years before resigning June 2 after winning re-election to another term as the organization's leader. Just before his resignation, Swiss authorities arrested seven FIFA executives as part of an FBI probe that indicted 14 people on bribery and corruption charges. Twenty-six banks are named in the indictment, including major US firms such as Citigroup and JP Morgan Chase.

"This level of corruption was only possible with the complicity of the global banking system," said Eric LeCompte, executive director of the religious development organization Jubilee USA Network. "The FIFA scandal shines a light on how corruption is protected and supported by US banks."

The corruption and bribery charges relate in part to FIFA's process for awarding world cups to host nations. Authorities are investigating South Africa's 2010 World Cup as well as upcoming World Cups in Russia in 2018 and Qatar in 2022. More than $150 million in FIFA bribes flowed through the US financial system, but in only one instance did a bank reject a money transfer out of suspicion. While US investigators are still determining if any banks broke US law, experts indicate that the transactions were likely structured to avoid triggering US anti-money laundering alarms.