Reactions to the 2018 UN Forum on Financing for Development

Members and experts from the Civil Society Financing for Development Group release statements at the conclusion of the 2018 Financing for Development Forum.

Commenting on forum discussions around debt relief processes for Caribbean and small islands, Eric LeCompte, Executive Director of Jubilee USA, said:

"During the Financing for Development Forum we saw growing concern about protecting small developing islands before the next hurricane season. There is growing consensus to put in place permanent debt relief processes to protect small islands when they are hit by natural disasters. We must all act quickly as the next hurricane season begins in weeks."

Lidy Nacpil, Coordinator of the Jubilee South Asia Pacific Movement on Debt and Development, stated:

"We welcome the attention that the UN FfD is giving to climate finance.  Development and climate are inextricably linked. But we are concerned that climate finance is not lumped together with official development assistance. Climate finance is not 'aid,' it is an obligation of rich countries to developing countries and must be additional to ODA."

Tove Maria Ryding, Tax Coordinator at the European Network on Debt and Development (Eurodad), added:

"After global tax scandals such as the Paradise Papers, it’s become very evident that our global tax system is deeply flawed and full of loopholes, and we know that illicit financial flows is costing developing countries billions of dollars every year. At the Financing for Development Forum, the developing countries called for an intergovernmental UN negotiation to solve these issues, but the rich countries are still dragging their feet on this point. One is left wondering how many international tax scandals it will take, before the rich countries are ready to come to the table and negotiate global solutions to this global problem."

The Civil Society FfD Group is an open mechanism for civil society organizations and networks to engage collectively, build synergy and speak with one voice in the formal UN FfD process and all its related and interconnected spaces.

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Eric LeCompte Quoted in ValueWalk on Rising Global Debt

Eric LeCompte, Executive Director of Jubilee USA was recently featured in ValueWalk speaking on global debt following the Spring International Monetary Fund and World Bank meetings in Washington, D.C. and the Financing for Development meetings at the United Nations last week in New York. Read excerpt below and follow link to full article.

At UN Meetings, Global Leaders Raise “Undiplomatic” Concerns Regarding Debt

By: Mark Melin

For the past ten years, the global economy has been growing and on a sustainable path, the IMF has reported in typically polite and diplomatic language. But the warnings contained in recent reports have been the focus of concerned global leaders attending UN meetings in New York this week, said Eric LeCompte, Executive Director of Jubliee USA and a UN consultant on sovereign debt.

LeCompte, attending the UN meetings, said that discussions were “less diplomatic” than normal as concerns were raised that a debt crisis could materialize if steps are not taken to avert the problem.

Looking at the emerging world economy, sovereign debt has reached levels where it is becoming non-productive. In areas such as Africa, for instance, debt to GDP levels is reaching 55%, up from 30%. “When debt in the developing world reaches 55%, the increased debt is used to make interest payments and does not go directly into the Economy,” LeCompte notes.

As the IMF looks at the financial landscape, it sees debt levels moving to unsustainable levels and speculative financial behavior, led by the roll-back of Dodd-Frank legislation, creating a toxic brew. “This is the formula that ushered in the 2008 financial crisis,” LeCompte said, noting his surprise that the IMF would be considering a universal basic income at the same time they are expressing serious concern over debt levels. He said concerns over rising populism, particularly if there is an economic downturn, are driving the IMF to get ahead of the issues.

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UN Forum Wrestles with Economic Policies 10 Years After Financial Crisis

Islands Call for Debt Relief Ahead of Next Hurricane Season

Officials from governments, the IMF, World Bank, the private sector and NGOs meet this week at the United Nations for the Financing for Development (FFD) Forum. The annual gathering seeks to implement the Addis Ababa Action Agenda that governments endorsed in 2015 in Ethiopia. 

"These meetings are critical to address the root causes of poverty and raise revenue in the developing world," said Jubilee USA Executive Director Eric LeCompte. LeCompte has participated in FFD negotiations since 2012. "Better policies on tax, debt, trade and transparency issues are critical for lifting people out of poverty."

During the forum, public statements and private negotiations focus on new debt relief processes for Caribbean and small islands ahead of the next hurricane season. Islands from Dominica to Barbuda are still recovering from the 2017 hurricane season.

"There is growing consensus among a number of decision making bodies to put in place permanent debt relief processes to protect small islands when they are hit by natural disasters," noted Eric LeCompte who supported similar processes at the IMF. "We must all act quickly as the next hurricane season begins in just a few weeks."

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All Africa Talks with Eric LeCompte about Global Debt

Eric LeCompte, Executive Director of Jubilee USA was recently featured in All Africa speaking on global debt. Read excerpt below and follow link to full article.

Ghana: IMF Warns Ghana Over Financial Crises

By: Felix Dela Klutse

"IMF sees continued economic growth, but it's warning that continued growth is short lived," Executive Director of Jubilee USA, Eric LeCompte, has stated during the 2018 Spring Meetings of the IMF and the World Bank Group in Washington DC, USA.

He continued: "Rising debt levels are a growing risk around the world. Now is the time for countries to get their houses in order to prevent and be prepared for future financial crises."

Mr LeCompte said countries need to rebuild fiscal buffers, enact structural reforms, and steer monetary policy cautiously in an environment that is already complex and challenging in order to prevent any future financial crises.

Read more here.

 

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IMF Communiqué: Transparency and Sustainable Financing Needed to Prevent Future Downturn

The International Monetary and Financial Committee of the IMF released their communiqué of the Spring meetings, noting, "The window of opportunity remains open and should be used expeditiously to advance policies and reforms that sustain the current upswing, enhance resilience, and raise medium-term growth for the benefit of all." The IMF raised serious concerns this week that the global economy is in for a "bumpy road ahead."

Eric LeCompte, the Executive Director of the religious development group Jubilee USA, has monitored IMF meetings for 10 years and releases the following statement:

"On the anniversary of the 2008 financial crisis, the IMF issued a series of warnings about the future of the global economy. 

"We still have not done enough to improve debt restructuring and enact measures for responsible lending and borrowing. Beyond preventing the next crisis, the IMF is warning that we could have a recipe for greater inequality that further divides the rich and the poor.

"The IMF is saying that now is the time for countries to get their houses in order to prevent and prepare for future financial crises. The IMF is warning that rising debt levels are a growing risk around the world."

 

Read the April 2018 Communiqué of the International Monetary and Financial Committee

Read the April 2018 World Economic Outlook

Read the International Monetary Fund's April 2018 Global Financial Stability Report

Read about the Thursday IMF event on the 10th Anniversary of the Financial Crisis

Read about Jubilee USA's Friday event on Global Renewal and improving debt restructuring 

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IMF and World Bank Meet on 10-Year Anniversary of Financial Crisis: Global Economy has a "Bumpy Road Ahead" Warns IMF

World leaders, finance ministers, the private sector and nongovernmental organizations begin the Spring International Monetary Fund and World Bank meetings on the 10-year anniversary of the global financial crisis. On Tuesday the IMF's economic outlook report predicts short-term global growth to 3.9%, it highlights debt levels, trade policies, decreased labor participation and aging populations as risks to long-term growth.

"The IMF is saying that now is the time for countries to get their houses in order to prevent and prepare for future financial crises," noted Jubilee USA Executive Director Eric LeCompte who serves on United Nation expert groups that focus on economic issues. LeCompte has monitored IMF meetings since the onset of the financial crisis. "The IMF is warning that rising debt levels are a growing risk around the world."

On Wednesday the Fund released its Global Financial Stability Report raising concerns that the global economy faces a "bumpy road ahead." The report warns that due to short and medium-term risks, the financial system could face serious risks to growth. Recently the Fund released analysis focusing on specific concerns with rising, unsustainable debt levels in Africa.

"We still have not done enough to improve debt restructuring and enact measure for responsible lending and borrowing," said LeCompte. "Beyond preventing the next crisis, the IMF is warning that we could have a recipe for greater inequality further dividing the rich and the poor."

Read the April 2018 World Economic Outlook

Read the International Monetary Fund's April 2018 Global Financial Stability Report

Read about the Thursday IMF event on the 10th Anniversary of the Financial Crisis

Read about Jubilee USA's Friday event on Global Renewal and improving debt restructuring 

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Human lives must be focus of Puerto Rico fiscal plan

Archbishop Roberto Gonzalez, Reverend Heriberto Martinez and Reverend Enrique Camacho, religious leaders from Puerto Rico and Eric LeCompte, Executive Director of Jubilee USA wrote and Op-ed featured in The Hill called "Human lives must be focus of Puerto Rico fiscal plan" talks about need of a fiscal plan that focuses on the people in need.

Read excerpt below and follow link to the full article.

Human lives must be focus of Puerto Rico fiscal plan

By: Archbishop Roberto Gonzalez, Reverend Heriberto Martinez, Reverend Enrique Camacho, and Eric LeCompte

As Puerto Rico continues to wrestle with power outages across the island, the federally appointed Financial Oversight and Management Board soon votes on a fiscal plan for economic growth. We are concerned that the current proposed fiscal plans fail to focus on improving and protecting the lives of 3.5 million U.S. citizens living in Puerto Rico.

A final fiscal plan should meet the following criteria:

  • There should be "breathing space" for the island from debt payments. Earlier proposed fiscal plans included a 5 year moratorium on all debt payments. This debt payment moratorium should be part of the new plan. Additionally, during this period interest must not accrue on the debt.
  • Beyond this five year debt moratorium period, no debt should be paid until Puerto Rico sees positive economic growth, a reduction in child poverty and the island has rebuilt from the hurricanes.
  • Ultimately, the total debt must be restructured and the principal of the debt must be cut. The fiscal plan should reflect the need for definitive debt cancellation of at least 80 percent of Puerto Rico's debt.
  • The fiscal plan should prevent further austerity measures, set goals to reduce child poverty, ensure adequate social protections, defend against corruption and stem migration from the island. 

In recent months, the process around the creation of the fiscal plan has been combative and produced plans that fail to meet the needs of Puerto Rico’s people. We urge the governor, the oversight board, creditors, the people most affected by these crises and all stakeholders to dialogue and work together.

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Bretton Woods Cites Eric LeCompte Discussing the Current Financial Crisis

Eric LeCompte, Executive Director of Jubilee USA was recently cited in Bretton Woods speaking on the current financial crisis. This discussion was held at the International Monetary Fund/ World Bank Spring Meeting Civil Society Forum event. Read the excerpt below and follow the link to full article.

Financial crisis 10 years on. Has the response to 2008 laid the foundations for the next?

By: Miriam Brett

Since January in the USA, there has been an attempt to repeal financial regulation measures put in place following the financial crisis.

The proposed repeal of section 1504 of the Dodd-Frank Act – also known as Cardin-Lugar anti corruption law – poses a significant threat. This is the portion of the legislation that called for greater transparency, recording payment processes, which acted as an anti-bribery law and covered areas such as illicit financial laws, tax evasion, and corruption. 1504 was under sustained attack and repealed in the House of Representatives.

This was significant as it had been used as a model for regulation and legislative measures post crisis, and a consensus was brought about on this.

A model law could offer a different approach and a legislative remedy to deal with 51 per cent of where the world’s debt stock is marketed. The US and UK have between an 85 and 90 per cent share of the debt market, and Germany, Singapore and Japan also charting high.

There is a possibility to change New York law as a model law, to say that if ¾ of investors agrees to a structuring, we have to move things forward for debt to be arbitrated, which could offer a viable and clear path forward.

Read more here.

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Metro Puerto Rico Covers Religious Leaders Letter to PR Oversight Board

Metro Puerto Rico covers a letter form Religious Leaders in Puerto Rico to the Financial Oversight and Management Board.  Eric LeCompte, Executive Director of Jubilee USA was also featured in the article. 

Read excerpt below and follow link to full article.

Religiosos hacen peticiones a la Junta en nueva carta:Los religiosos enviaron hoy la carta a la Junta de Control Fiscal

By: Metro Puerto Rico

Por su parte, Eric LeCompte, director ejecutivo de Jubilee USA, expuso en una comunicación escrita que "Puerto Rico no puede pagar ninguna deuda hasta que se recupere de los huracanes, ve un crecimiento económico sostenido y una reducción de la pobreza infantil". "Además de cancelar la mayor parte de la deuda de Puerto Rico, un nuevo plan fiscal debería evitar una mayor austeridad, reducir la corrupción y respaldar protecciones sociales adecuadas", agregó.

Finalmente, Jubilee USA indicó que en la carta que los líderes religiosos enviaron a la Junta el martes, pidieron una moratoria de pago de la deuda de 5 años. "Instamos a todas las partes interesadas a dialogar y trabajar juntas por el renacimiento, la libertad y la nueva vida para la gente de Puerto Rico".

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Puerto Rico Should Cut Debt and Protect Poor Say Island Religious Leaders

As Puerto Rico's oversight board considers a fiscal plan, major religious leaders say the final plan should cut debt, prevent austerity and reduce child poverty. San Juan's Catholic Archbishop, Puerto Rico Evangelical Bible Society leader and the Executive Director of the island's Catholic Charities sent a letter to the oversight board.

"We are writing as you prepare to certify a new fiscal plan for Puerto Rico that takes into account the devastation and immense suffering of Puerto Rico's people due to hurricanes, Irma and Maria," wrote Archbishop Roberto González, Reverend Heriberto Martinez and Reverend Enrique Camacho. "We are concerned that the current fiscal plan under debate fails to consider the serious impact of these storms. We are concerned that monies Congress authorized for healthcare and hurricane relief could be used to pay creditors."

In the summer of 2016, Congress passed emergency debt crisis legislation that created a federally appointed oversight board to implement a fiscal plan for an island that wrestles with a 58% child poverty rate. After the hurricanes struck, the oversight board withdrew their original plan in order to create a new plan to take into account the impact of the storms.

Puerto Rico's Governor submitted a new plan that the oversight board is scheduled to certify this week. The new proposed fiscal plan pays 40 cents on the dollar for debt service when the previous plan in place before the hurricanes paid 25 cents on the dollar to creditors. Governor Ricardo Rosselló and the oversight board have disagreed about implementing a debt payment moratorium and cuts to public pensions.

"Puerto Rico can not pay any debt until it recovers from the hurricanes, sees sustained economic growth and a reduction in child poverty," noted Jubilee USA Executive Director Eric LeCompte who advises Puerto Rico's religious leaders. "In addition to canceling most of Puerto Rico's debt, a new fiscal plan should prevent further austerity, curtail corruption and support adequate social protections."

In the letter that the religious leaders sent to the oversight board on Tuesday, they called for a 5 year debt payment moratorium, for at least 80% of the total debt to be cut and urged that a focus of the plan should be to stem migration from Puerto Rico.

"We urge all stakeholders to dialogue and work together for rebirth, freedom and new life for Puerto Rico's people. Puerto Rico can be reborn after the hurricanes," stated Puerto Rico's religious leaders in their letter to the oversight board. "Puerto Rico's people can be free from debt, corruption and constraining economic policies."

Read the full religious leader letter

Lea la carta completa del líderes religiosos

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