The Jubilee Blog

IMF Head: Global Recovery Uncertain as People Face Income Drops

International Monetary Fund head Kristalina Georgieva warned of an uncertain global recovery as the world struggles with the COVID spurred economic crisis. The IMF Managing Director stated concern that average incomes in developing countries faced drops of 20% and 11% in advanced economies. "This loss of income means millions of people will face destitution, homelessness, and hunger," reported Georgieva during her curtain raiser speech ahead of the Spring IMF and World Bank meetings.

"While prospects for economic recovery are higher in the United States and China, every country in the world faces greater inequality and increases in poverty," noted Jubilee USA Executive Director Eric LeCompte who has monitored IMF policies for more than a decade. "The average person is worse off as the pandemic economic crisis continues."

The IMF chief warned developing countries, with less vaccine access, lower budgets and higher debts, could face more pressure. In particular developing middle-income countries face serious challenges.

“The IMF is right that middle-income countries need more support,” added LeCompte. "Developing middle-income countries face the highest job losses and increases in poverty. Yet, these countries are left out of critical aid and debt relief initiatives."

Georgieva highlighted one area on the horizon that could benefit these countries, is the creation of $650 billion in global reserve funds known as Special Drawing Rights.

“The creation of Special Drawing Rights will deliver more than $200 billion in aid for developing countries," reflected LeCompte.

View Managing Director Kristalina Georgieva's Spring IMF Meetings Curtain Raiser Speech here. 

https://www.jubileeusa.org/pr_imf_2021_curtain_raiser

IMF Announces $650 Billion in Emergency Reserves Needed to Confront Pandemic Crisis

By: Zachary Conti

The International Monetary Fund announced $650 billion in emergency reserve funds are needed to confront the global coronavirus health and economic crisis. The funds are likened to a type of currency the International Monetary Fund creates, called Special Drawing Rights (SDRs).

"This announcement is incredible progress," stated Eric LeCompte, the executive director of Jubilee USA Network. LeCompte's development group advocated the use of these emergency reserve funds for more than a year. "This information now helps countries, like the United States, begin a process to authorize the creation of these emergency funds. Developing countries need these resources to confront the crisis as soon as possible."

About $224 billion would immediately go to developing low-income and middle-income countries in the creation of $650 billion SDRs. US Treasury has called for the remaining amount to be donated to support vulnerable countries.

SDRs were last created following the 2008 financial crisis. On Tuesday, Jubilee USA Network organized a roundtable with high-ranking religious leaders and Treasury Secretary Janet Yellen that focused on SDRs.

"Special Drawing Rights can provide support for countries struggling with the health and economic impacts of the coronavirus," noted LeCompte, a United Nations finance expert. "As countries are struggling with the crisis, SDRs are an important part of the relief developing countries need."

In February, the US Conference of Catholic Bishops and Jubilee USA sent a letter on SDRs to President Biden and Yellen. Jubilee USA Network with Latindadd, a Latin American development group, organized a letter with more than 200 organizations calling on the G20 to support an SDR issuance.

On Friday, the G7 agreed to a "sizeable" new issuance of Special Drawing Rights.

Read about Friday's G7 SDR announcement here.

Read about the March 16th Secretary Yellen Jubilee USA Network Meeting here.

Read the letter on SDRs, aid, and debt relief from the US Conference of Catholic Bishops and Jubilee USA Network here.

Read the letter organized by Jubilee USA with 200 plus signers urging the G20 to support SDRs here.

Read the IMF Managing Director's statement here. 

G7 Supports Emergency Funds for Developing Country COVID Relief

G7 finance ministers agreed to create emergency reserve funds for developing countries wrestling with coronavirus economic impacts. The funds are likened to a type of currency the International Monetary Fund creates, called Special Drawing Rights (SDRs).

"This is the strongest public statement to date from G7 countries on the need for SDRs to confront the COVID economic crisis that is ravaging developing countries," stated Eric LeCompte, the executive director of Jubilee USA Network. LeCompte's development group advocated the use of these emergency reserve funds for more than a year. "We are waiting on the IMF to formally assess the needs of poor countries to decide on the size of a SDR issuance. There is no doubt that developing countries have needs north of a trillion dollars."

SDRs were last created following the 2008 financial crisis. On Tuesday, Jubilee USA Network organized a roundtable with high ranking religious leaders and Treasury Secretary Janet Yellen that focused on SDRs.

"Treasury is a strong proponent of moving forward development aid and debt relief," noted LeCompte. "As countries are struggling from the crisis, we need to be sure the aid is enough and that all developing countries can get the support they need."

In February, the US Conference of Catholic Bishops and Jubilee USA sent a letter on SDRs to President Biden and Yellen. Jubilee USA Network with Latindadd, a Latin American development group, organized a letter with more than 200 organizations calling on the G20 to support a SDR issuance.

Read about the March 16th Secretary Yellen Jubilee USA Network Meeting here.

Read the letter on SDRs, aid and debt relief from the US Conference of Catholic Bishops and Jubilee USA Network here.

Read the letter organized by Jubilee USA with 200 plus signers urging the G20 to support SDRs here.

 

https://www.jubileeusa.org/pr_g7_supports_sdrs_covid

Treasury Secretary Yellen and Religious Leaders Hold Historic Meeting on Global COVID Response

By Zach Conti

Treasury Secretary Janet Yellen, Jubilee USA Network and some of the highest-ranking religious leaders met on global COVID response on Tuesday. The high-level roundtable discussion focused on emergency SDR reserve funds, debt policies, aid, climate change, Puerto Rico relief and bankruptcy, transparency and tax proposals to prevent future crises.

"The meeting with Secretary Yellen and leaders from the largest faith traditions was historic," noted Jubilee USA Executive Director Eric LeCompte who organized the meeting. "Since the beginning of the pandemic, religious institutions have called for responses to the COVID crisis that protect the vulnerable and address inequality." 

Leaders of the Catholic, Methodist, Lutheran, Presbyterian and United Church of Christ Churches, the Union for Reform Judaism, Puerto Rico's Catholic Church and the Puerto Rico Evangelical General Bible Society attended the meeting. Jubilee USA Network was also joined by the AFL-CIO and International Trade Union Confederation.

"The religious community is concerned that many developing countries are left out of crisis response," noted LeCompte a United Nations finance expert. "The discussion with Yellen was critical on climate change because many of the most significant climate decisions will be made by Treasury, the IMF and G20."

Climate policies are a growing focus of the G7 and G20. In a recent letter to the G20, Yellen called for cooperation to address climate and support low-income countries to meet climate goals.

"President Biden’s climate executive order instructs Treasury to promote policies that protect the environment and address climate change,” stated LeCompte.

Organized by Jubilee USA, 220 religious, labor and human rights groups signed a letter to Biden calling for aid, debt relief and new development processes to confront the pandemic. In February, the US Conference of Catholic Bishops and Jubilee USA Network sent a letter to Biden urging short-term solutions to confront the current crisis and long-term solutions to prevent future crises.

Read Treasury Secretary Yellen/Jubilee USA Network roundtable agenda here. 

Read Treasury's readout and release on the roundtable here.

Read the letter to President Biden and Secretary Yellen from the US Conference of Catholic Bishops and Jubilee USA Network here. 

Read the letter from Treasury Secretary Yellen to G20 Finance Ministers here. 

Read Jubilee USA's COVID-19 Jubilee White House, IMF, G20 letter signed by 220 groups here.

 

https://www.jubileeusa.org/pr_yellen_jusa_meeting

Stimulus Package Aids Puerto Rico

By: Zachary Conti

Congress passed a $1.9 trillion stimulus package that includes Puerto Rico anti-poverty measures and $900 million of increased food aid through the Nutrition Assistance Program. The US territory suffers from a nearly 60% child poverty rate and the coronavirus rescue package funds Puerto Rico's child tax credit benefiting 355,000 low-income families.

“Devastated by the pandemic, debt crisis, high child poverty rates and natural disasters, Puerto Rico needs the stimulus package aid,” said Eric LeCompte, the Executive Director of religious development group Jubilee USA Network.

The legislation expands the Earned Income Tax Credit for poor working families on the island. 

Last month, 20 US and Puerto Rico religious leaders sent a letter to Congress and President Biden urging that stimulus packages include job creation, disaster relief, food assistance and the anti-poverty tax measures for the territory.

“Beyond the stimulus aid, Puerto Rico needs more disaster relief,” stated LeCompte. "The Department of Justice can unblock more than $2 billion in disability aid for the island."

Under the Trump Administration, the Department of Justice (DOJ) appealed to the Supreme Court to block a lower court ruling that approved $2.3 billion in annual Supplemental Security Income disability payments for 300,000 people in Puerto Rico. The religious leader letter requested that the Biden Administration instruct the DOJ to withdraw the case to allow the disability aid to reach the island.

Read the Puerto Rico letter to President Biden and the 20 Puerto Rico and US religious leaders signers in English and Spanish here. 

Pope Visits Iraq Amidst COVID Crisis, Conflict, Soaring Poverty and Struggling Economy

By Zachary Conti, 

 

Shia Muslim Leader and Pope to Meet

Pope Francis kicks off a 3-day Iraq tour and meetings with Muslim leaders, government officials and representatives of the country's dwindling Christian population. Since the coronavirus pandemic began, Iraq saw poverty numbers climb to 37% and an estimated 11% contraction in its economy.

"Iraq was already struggling before the pandemic hit and now the suffering is even worse," stated the Executive Director of the religious development group Jubilee USA Network, Eric LeCompte. LeCompte advises the Vatican and Catholic leaders on economic issues. "The coronavirus crisis for Iraq means poverty has doubled and the country can't make debt payments and also pay workers."

In February the International Monetary Fund reported the COVID-19 pandemic caused a significant decline in the countries main revenue source, oil. Coupled with challenges of corruption, the Fund estimated the downturn of Iraq's 2020 economy by 11%.

"The Pope's visit brings hope as Iraq's people suffer from the pandemic, conflict, corruption, soaring food prices and increasing poverty," shared LeCompte. "Like too many countries, it will take Iraq's economy years to rebound to pre-pandemic levels. Iraq's pre-pandemic economy wasn't great and already had too much suffering."

The IMF forecasts that Iraq's debt will steadily rise through 2023 and could see pre-pandemic economic outputs in 2024.

On Saturday, Pope Francis travels to Iraq's holiest city, Najaf, to meet with Grand Ayatollah Sayyid Ali al-Husayni al-Sistani who leads Iraq's Shia Muslims.

"The meeting between Ayatollah Sistani and Pope Francis signifies the Pope's commitment to tackle world problems with people of all faiths," stated LeCompte whose organization is composed of multiple faith groups including Muslims, Jews and Christians. "The Pope took the name Francis after the famed St. Francis who met with the Muslim Sultan Malek al-Kamil in 1219. The meeting between St. Francis and Sultan al-Kamil is a symbol for Pope Francis of the critical importance of interfaith dialogue."

Iraq is the birthplace of the Prophet Abraham, an important figure for Jews, Muslims and Christians.

Read the IMF's recent report on Iraq here.