Legislation To Expand Debt Cancellation to Poor Countries, Reform IMF/World Bank Lending Practices Passes House Financial Services Committee

Full House of Representatives Expected to Consider Jubilee Act for Responsible Lending and Expanded Debt Cancellation Next Week

Jubilee USA Network
www.jubileeusa.org

FOR IMMEDIATE RELEASE
Thursday, April 3, 3008 

Contact: Eleiza Braun
Neil Watkins, 202-783-0129, 202-421-1023 (c)

WASHINGTON – Jubilee USA Network, an alliance of more than 80 religious denominations, development agencies and human rights groups, today heralded the passage by voice vote in the House Financial Services Committee of the Jubilee Act for Responsible Lending and Expanded Debt Cancellation (HR 2634).

The bill’s passage in committee comes just ahead of the spring meetings of the IMF/World Bank, set to be held from April 12-13 in Washington next weekend. Poor countries that would be made eligible for the bill owe much of their debt to the IMF and World Bank.

“We welcome the strong bi-partisan committee support for this forward-looking legislation which, when passed, will help to ease the unjust burden of debt on some the world’s most impoverished nations,” said Neil Watkins, National Coordinator of Jubilee USA Network. “As importantly, the bill urges greater responsibility in lending and borrowing in the future, so as to arrest the accumulation of odious and unjust debts that have plagued nations of Africa, Asia and Latin America for decades.”

The legislation calls on the US Treasury Department to negotiate at the IMF and World Bank for an agreement for debt cancellation for up to 24 additional poor countries that need cancellation to meet the Millennium Development Goals (MDGs) but do not currently qualify for the current IMF/World Bank debt relief Initiative. The bill also addresses current IMF/World Bank policies and other global lending policies by:

• Urging greater resources be devoted to grants for the world’s poorest countries;
• Requiring greater transparency at the IFIs and a policy of maximum disclosure in project and loan documents;
• Urging the development of a binding framework for more responsible lending practices in the future;
• Sharply limiting the types of conditions that may be required of countries going through the debt relief process to those focused on making sure that money released by debt relief is used transparently and accountably; and
• Directing the GAO to undertake an audit of odious lending by the World Bank, IMF, and US government in specific countries.

It is anticipated that the legislation will be considered by the full House of Representatives next week.  Companion legislation has been introduced in the Senate (S. 2166); a hearing on the Senate companion to the Jubilee Act has been set for April 24.