The Jubilee Blog

Senator Lugar Jubilee USA Statement

April 29, 2019

Washington DC - On Sunday, former Indiana Senator Richard Lugar (R) died. Lugar sponsored and led Jubilee USA legislation and efforts on debt relief, anti-corruption, preventing financial crisis, tax evasion and the Jubilee Act on responsible lending and borrowing. Eric LeCompte the Executive Director of the religious development group Jubilee USA, releases the following statement on Senator Lugar:

"Senator Lugar was a bridge builder and defender of the vulnerable.

"Lugar was a leader of legislation to prevent financial crisis, provide debt relief for poor countries and make our financial system more responsible and transparent.

"Currently in Congress we face such polarization and so many divides. In Washington DC, we need his kind of leadership again."

Second Deadly Cyclone Hits Mozambique

April 26, 2019

Washington DC - Category-4 Cyclone Kenneth hit Mozambique Thursday night, the second severe storm to hit the country in six weeks. According to the United Nations Office for the Coordination of Humanitarian Affairs, 30,000 people were evacuated because of Cyclone Kenneth and another 70,000 people are still in harm's way. The hurricane-strength storm is predicted to drop twice as much rainfall as Cyclone Idai, which devastated the East African nation in March. Mozambique is still recovering from Cyclone Idai and the International Monetary Fund loaned $118.2 million for Idai rebuilding efforts.

"It's time to move away from loans for Mozambique and start the process of debt relief," said United Nations debt expert Eric LeCompte who heads the religious development group Jubilee USA. "This cyclone was the first major storm to hit Mozambique with hurricane strength in 60 years and as one of the poorest countries in the world, they don't have the resources to respond."

The United Nations Development Programme ranks Mozambique as the 9th least developed country in the world out of 189 ranked countries. On March 14th and 15th Cyclone Idai made landfall, killing over 700 people and causing an estimated $2 billion in damage. 

In 2016 the IMF stopped financing Mozambique after over $1 billion in secret loans were discovered to outfit fishing boats into military crafts.

"Debt relief is an effective form of disaster aid and must be an important part of Mozambique's recovery," said LeCompte.

UN Forum Wrestles with Funding Development

April 19, 2019

New York City - After months of negotiations and four days of formal meetings, the United Nations voted on development policies at the fourth UN Financing for Development Forum. The UN meetings convene world leaders, ministers, governments, the IMF, World Bank and development groups. The annual process attempts to implement the 2015 Addis Ababa Action Agenda, an international agreement that includes policies on debt, tax, trade, transparency and aid.

"If we can improve trade, debt and tax policies, we can mobilize the resources to end extreme poverty and achieve the UN development goals," stated Jubilee USA Executive Director Eric LeCompte. LeCompte helped forge the 2015 UN Addis Ababa Financing for Development agreement. "The developing world loses more than a trillion dollars annually because of unsustainable debts, tax evasion, tax avoidance, corruption, trade practices and a lack of loan and budget transparency."

The UN meetings took place days after the IMF issued two reports warning of a potential financial crisis due to risky market behaviors and high sovereign and corporate debt.

"The same financial and economic policies that can fund development are some of the same policies that can prevent financial crisis," noted LeCompte who addressed the UN body on Thursday. "While these meetings are helpful for education and to build greater consensus, implementation is not moving quickly enough."

The Financing for Development process will continue during High-Level UN meetings in the Fall and the UN 2030 Sustainable Development Goals process.

Implementing Debt Policy Commitments from the Addis Ababa Action Agenda

United Nations Financing for Development Forum

(Remarks as prepared for delivery)

Eric LeCompte
Executive Director
Jubilee USA Network

April 18th, 2019

Thank-you Mr. Chair.

 

Today I speak on behalf of Jubilee USA, a coalition of more than 700 faith communities across the United States. Our founders and national members range from the US Conference of Catholic Bishops, the United Church of Christ, Protestant Mainline denominations, American Jewish World Service and Islamic Relief.

Jubilee USA seeks to protect and lift vulnerable communities across our world. Jubilee USA, the global Jubilee Movement, many of the leaders and governments in this room along with the leadership of President George Bush, moved forward debt relief policies that won more than 130 billion dollars in debt relief for the world's poorest countries.

Together the policies that we won allowed more than 54 millions kids in Sub-Saharan Africa to attend school who never would have seen the inside of a classroom. Together, we forged the political will to ensure that debt relief, an effective form of accountable aid, would be invested in social infrastructure in the developing world.

Amidst such great progress, much of the world is facing debt risks, debt distress and some countries face debt crisis.

Recent reports from the International Monetary Fund and the United Nations Conference on Trade and Development warn of new emerging debt crises.

When we met together in 2015 and forged the Addis Ababa Action Agenda, 22% of the world's countries were facing debt concerns, debt distress or debt crisis. As we meet today in 2019, that number has doubled and now 44% of our world faces debt concerns, debt distress or financial crisis. 40% of the world's low-income countries face debt distress or debt crisis.

17 countries are now in default and unable to pay their loans or their debt.

While debt crises hurts a country and their population, wide spread debt crises can create the conditions for another global financial crisis.

Last week, the IMF released its two flagship reports warning of another potential global financial crisis, the World Economic Outlook Report and the Global Financial Stability Report. On Tuesday, the IMF released its World Economic Outlook Report warning governments that if they don't tackle unsustainable debt and stop predatory risky behavior, we could be in store for another global financial crisis.

Last Wednesday, the IMF released its Global Financial Stability Report and made direct comparisons to the conditions that caused the 2008 global financial crisis and our economy now. In fact, the IMF directly compared the causal conditions of 2008 to now and analyzed sovereign debt levels, corporate debt levels and home values. The IMF is worried.

When we met and forged an agreement in 2015, we agreed on recommendations in the Addis Ababa Action Agreement to tackle financial crisis and debt crisis. Today I ask the panelists, the floor and UN Member States what we have done to formalize, implement and act upon the critical debt agreement we made together in Addis Ababa.

According to the Addis Ababa Action Agenda, we all made 4 specific commitments and I ask the floor what we have achieved regarding the actual implementation of these agreements.

1.) In 2015 we called for countries to pass national domestic legislation to stop the predatory behavior of so-called vulture funds. What progress have we made?

2.) In 2015 we called for the achievement of a global consensus on responsible lending and borrowing. Where are we on achieving a global legal framework on this? We expect responsible lending and borrowing frameworks to bring stability to our domestic economies, but these legal frameworks are still absent from our global economy.

3.) Similarly, we agreed upon improved debt restructuring processes based on domestic principles of lawful bankruptcy we enjoy in most of our domestic economies and that we rely upon for domestic economic stability. We agreed on improved debt restructuring processes that would be transparent, negotiated in good faith, neutrally arbitrated and be comprehensive. I ask the floor and the panel, where we are today?

4.) Finally, in the Addis Ababa Action Agenda we agreed that special protections should be granted for Small Island Developing States (SIDs) and the Caribbean region to ensure timely debt restructuring and sustainable financing. I ask the floor where we are today on this commitment.

These questions I ask about the commitments that we made together are urgent if we wish to finance the SDGs and prevent financial crisis.

Let us not forget that the financial crisis of 2008, according to the World Bank, pushed nearly 100 million people - mostly women and children - into extreme poverty.

I ask the panel and the floor, where are we in passing domestic legislation to stop vulture funds, where are we in implementing a global legal framework on responsible lending and borrowing, where are we in formalizing global debt restructuring in accordance with our domestic bankruptcy laws and where are we in improving debt restructuring and sustainable financing for the hurricane prone small islands and Caribbean countries across the region?

Thank-you Mr. Chair and panelists for considering my comments and questions.

Jubilee USA Statement on Spring World Bank and IMF Meetings

April 13, 2019

Washington DC - World leaders, Finance Ministers, industry representatives and development groups are meeting at the Spring World Bank and IMF Meetings. Eric LeCompte the Executive Director of Jubilee USA, a religious development organization, releases the following statement on the Spring Meetings and the Communique of the thirty-ninth International Monetary and Financial Committee:

"The IMF is urging us to do all we can to prevent another financial crisis. Reducing risky market behavior and tackling unsustainable government and corporate debts are priorities to prevent another financial crisis.

"In two reports this week, the IMF analyzes our current economic situation against conditions that led to the 2008 financial crisis. They are worried and don't want history to repeat itself.

"The last financial crisis drove nearly 100 million people, mostly women and children, into extreme poverty. Our world can not afford another crisis.

"High debt loads, financial transparency policies and trade tensions were key focuses of the meetings. We need policies that can cut unsustainable debt, curb tax evasion, avoidance and corruption to raise revenue and build a trade regime that protects workers and the poor."

Somalia Leaders Call for Debt Cancellation

April 11, 2019

Washington DC - In Somalia, 60 percent of the 15 million person population lives in extreme poverty. According to the United Nations Development Programme almost 10 million people live in extreme poverty or close to poverty in Somalia while the war-torn African nation wrestles with a $4.6 billion debt. On Friday, Somalia's Finance Minister Abdirahman Beileh will call for debt cancellation for humanitarian assistance.

"In the face of such terrible suffering, Somalia's debt must be eliminated as soon as possible," noted Jubilee USA Executive Director Eric LeCompte who serves on United Nations debt expert groups. "Eliminating Somalia's debt means an immediate investment to reduce extreme poverty in the country."

Somalia owes more than $4.6 billion in debt. The United States, France, Italy, the IMF and World Bank hold the highest levels of Somalia debt.

"Humanitarian concerns and global political will are coming together to relieve Somalia's debt," stated LeCompte. "The situation is so extreme in Somalia and we need immediate debt relief."

On Friday morning Somalia's Finance Minister, Jubilee USA head - Eric LeCompte, the African Development Bank and Save Somali Women and Children will participate in the forum at the US Institute of Peace. American Friends Service Committee, the Somalia NGO Consortium, Somalia Working Group, Jubilee USA Network and the African Faith and Justice Network are sponsoring the event. 

IMF Warns of Global Financial Crisis Risk

April 10, 2019

Washington DC - For the second day in a row, the International Monetary Fund raised concerns of pending financial crisis. Ahead of the Spring IMF and World Bank meetings, the IMF released the Global Financial Stability Report, warning of "vulnerabilities" in corporate debt, house values and sovereign (country) debt.

"We are seeing some of same conditions that created the 2008 financial crisis and the IMF worries that we are not doing enough to prevent the next financial crisis," stated Jubilee USA Executive Director Eric LeCompte who monitors IMF reports. "When we review the IMF's analysis, they are looking directly at causes of the 2008 financial crisis, including house values, corporate and country debt and risky financial behavior."

On Tuesday, the IMF released the biannual World Economic Outlook Report noting a global growth slowdown and raising concerns about unsustainable debt, trade tensions and the impact of natural disasters on the financial system. The IMF expressed heightened concerns of looming debt crises and possible financial crisis. 

On the heels of the IMF report releases, the IMF and development groups organized a high-level event at the meetings,"Tackling the Next Wave of Sovereign Debt Crises." On Wednesday, world leaders, finance ministers, business leaders, journalists and development groups attend the event at IMF Headquarters. 

"In order to prevent financial crisis, we need stronger international and national policies to deal with debt problems, stop risky financial behavior and promote tax and transparency policies that can raise revenue," said LeCompte, one of the organizers of the debt event.

The speakers at the high-level forum include Benin's Finance Minister Romuald Wadagni, the IMF's David Lipton, The Guardian's Larry Elliot, the director of AFRODAD - Fanwell Bokosi and legal experts Lee Buccheit and Odette Lienau. Jubilee USA Network, AFRODAD, Oxfam, Latindadd, Eurodad, Jubilee Debt Campaign (UK), Jubilee Germany and the IMF sponsored the event. In addition to the high-level debt panel, Jubilee USA is also organizing events this week on Somalia, transparency policies and country debt case studies.

IMF Worries: Debt, Trade, Economy

April 9, 2019

Washington DC - As world leaders, finance ministers, business leaders and development groups gather for the Spring International Monetary Fund and World Bank meetings, the IMF raises fresh concerns about the global economy. The IMF releases the biannual World Economic Outlook Report noting a slowdown in global growth and focusing on economic challenges that include unsustainable debt, trade tensions and the impact of natural disasters on the financial system.

"For several years now, the IMF continues to raise concerns over possible financial crisis and economic stability," noted Jubilee USA Executive Director Eric LeCompte, who tracked IMF meetings and reports for the last 10 years. "While the IMF downplays the possibility of a recession, the IMF analysis argues we could see another recession if we don't address risky behavior, trade tensions and debt concerns."

The IMF report forecasts a downturn in 2019 economic growth from 3.6 percent to 3.3 percent. With heightened concerns of looming debt crises, the IMF joined Jubilee USA and other debt watchdogs to host a major high-level event for meeting attendees on Wednesday, "Tackling the Next Wave of Sovereign Debt Crises."

On Friday, Jubilee USA moderates a discussion of Latin American and African groups releasing new reports on debt, "Dealing with Sovereign Debt Distress: Case Studies, Causes and Solutions."

"If we are going to prevent the next financial crisis, we need stronger international and national policies to deal with debt problems, stop risky financial behavior and promote tax and transparency policies that can raise revenue," stated LeCompte.

Senate Disaster Funding Fails Over Puerto Rico Aid Debate

April 2, 2019

Washington, DC - On Monday the Senate failed to pass disaster relief funding to benefit Americans impacted by wildfires, hurricanes, flooding and other natural disasters. Republicans and Democrats clashed over recovery aid amounts for Puerto Rico and two separate proposals could not muster enough votes for passage.

"The Senate must work together and pass a disaster relief package that ensures Americans from Iowa to Puerto Rico get the recovery aid they need," stated Eric LeCompte the Executive Director of Jubilee USA, a religious development group. "Because of the Senate's inability to take action, over a million vulnerable people in Puerto Rico lost food assistance benefits last month. The Senate must move forward a disaster relief package immediately."

As Puerto Rico disaster aid continues to be debated, additional relief monies are on hold for Americans suffering from disasters in Nebraska, Iowa, North Carolina, Florida and Georgia.

IMF Head Addresses US Chamber on Global Economy Risks

April 02, 2019

 DC - Ahead of the Spring International Monetary Fund and World Bank meetings, the head of the IMF, Christine Lagarde delivered a speech to the US Chamber of Commerce, "A Delicate Moment for the Global Economy: Three Priority Areas for Action."

Eric LeCompte the Executive Director of Jubilee USA, a religious development organization, releases the following statement on Lagarde's speech:

"As world leaders prepare for the Spring IMF meetings, Lagarde is raising concerns about the state of the global economy. Lagarde calls for tackling unsustainable debt, corporate tax avoidance and global corruption.

"She acknowledges that when trade deals are done wrong, it can hurt workers and the poor. When we look at Lagarde's speech in light of IMF reports from the last year on growing risks facing the global economy, the IMF is heightening concern for economic stability and growth."