IMF Predicts Global Economy to Lose $4 Trillion

"Senseless War," Pandemic and Inflation Threaten Economy, Warns IMF Chief Ahead of World Leader Meetings

Washington DC – The global economy is more fragile noted IMF Managing Director Kristalina Georgieva. In her curtain-raiser speech ahead of the IMF and World Bank Annual Meetings, Georgieva predicted a $4 trillion global loss through 2026.

“Most of us already feel like we are experiencing a recession," said Eric LeCompte the Executive Director of Jubilee USA Network who has monitored IMF policy since 2010. “Before the pandemic, most of the world's countries were facing economic crises. Since the pandemic, we had three years of crisis after crisis and the world is facing recession."

According to Georgieva, growing debt vulnerabilities in emerging developing economies and more than 60% of low-income countries raise the risk of a widening debt crisis that harms populations and global growth. The IMF chief urged a quicker implementation of a G20 debt relief process known as the Common Framework for Debt Treatments Beyond the Debt Service Suspension Initiative.

“Debt relief processes are moving too slow,” stated LeCompte, a United Nations finance expert. "The debt relief processes that we have don't even cover all of the countries in dire need of relief."

Referring to food insecurity that now affects more than 345 million people worldwide, Georgieva said that a food emergency financing window that the IMF unveiled last week will help the most affected countries.

“The IMF acted rapidly to support countries facing rapidly rising food bills, but we should not forget these are still loans for countries facing too much debt,” stated LeCompte. 

Watch the curtain-raiser speech here.

Read Jubilee USA's press release on the IMF Food Shock Window here.

Find Jubilee USA's full list of upcoming events here.

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Available for interview: Eric LeCompte, Executive Director
Contact: Anjoulie Woodhead, Communications and Outreach Director
[email protected] / (202) 430-6975

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Jubilee USA Teach-In, Press Conference and Vigil

October 14-15, 2022

World leaders will gather in Washington, DC for G20, G7, IMF and World Bank Meetings from October 10th - October 16th. At these meetings, they will make consequential decisions affecting billions of people and our planet. In the face of shocks from the Ukraine war, the pandemic and food crisis, we are calling on world leaders to support jobs, vaccine distribution, debt relief, economic aid and climate change solutions.

Join us on Friday, October 14th for a vigil, teach-in and press conference outside of the IMF, World Bank and G20 Meetings. Hear how religious and community leaders from around the world are working for a Jubilee. On Saturday morning, October 15th, we will bring thousands of paper chains to the IMF calling for debt relief and economic aid.


To stay up to date on all of the events please register at the link below. If you have any questions feel free to contact [email protected] or [email protected].
 
Where:
Community Park and Edward R Murrow Park 1872-1842 Pennsylvania Avenue NW, Washington, DC 20006


Schedule for Friday, October 14th
  • 9:00 AM – 11:45 AM: Building the Sukkah: Welcoming

  • 2:00 PM: Opening Prayer Service

  • 2:15 PM: Press Conference

  • 2:45 PM: Teach-In

  • 5:15 PM: Prayer Service
Schedule for Saturday, October 15th
  • 9:00 AM - 12 PM: Vigil

  • 12:00 PM: Break the Chains of Debt: Paper Chains and Messages Delivered to IMF and G20
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African Bishops Call for Debt Relief and Aid to Address Multiple Crises

Statement Precedes G7, African Finance Ministers and IMF Washington Meetings

Washington DC – G7 and African finance leaders should work together to remove the heavy burdens of debts in Africa, Catholic bishops and other faith leaders from the region said in Accra, Ghana, at the end of a two-day meeting. Representing churches in Cameroon, Cote d’Ivoire, Kenya, Ghana, Liberia, Nigeria, Senegal, Togo and South Africa, the dignitaries discussed the effects and responses to the pandemic, Russia-Ukraine war, food inflation and rising interest rates shocks in Africa.

“Less than three years after the biggest global recession in a century, the threat of recession looms again,” the bishops said. “Budget shortfalls and unpayable debts have reduced the room for our countries to take the actions needed to protect the most vulnerable and restore prosperity.”

On October 12th, G7 and African finance ministers will meet on the sidelines of the IMF/World Bank Annual Meetings in Washington DC. Debt, aid and future solutions for debt crises will be on the agenda.

"Africa's religious leaders see the suffering of their people and are calling on world leaders to provide the debt relief and aid needed to fight high food costs and the shocks from the pandemic," shared Eric LeCompte the Executive Director of the religious development group Jubilee USA Network. Jubilee USA works with faith leaders on pandemic and crisis response. "If we are to address global poverty, we need to address the debt and economic structures that are causing poverty around the world."

The African prelates recalled Popes John Paul II and Francis’ support for debt relief and asked for debt relief assessments to enshrine the principle that human development and climate investments come before debt payments.

“G7 countries, as key debt governing jurisdictions, should pass domestic legislations that prevent private creditor litigation from undermining international debt relief efforts,” added the bishops.

Under legislation currently before the New York State Assembly, private creditors would have to join international debt relief deals signed by public creditors. Jubilee USA supports the legislation, and is working with counterparts in key G7 jurisdictions to implement similar initiatives.

The faith leaders also highlighted the importance of the $650 billion in Special Drawing Rights – an emergency currency the IMF creates – released last year for pandemic crisis relief. They called on rich countries to transfer a significant portion of their share of SDRs to African countries.

“We want to highlight the enormous potential in [the] region of rechanneling through the African Development Bank,” faith leaders said.

The African Development Bank is one of the lenders seeking to fund new loans to its members with rich-country SDR contributions. The G20 committed to a global objective of $100 billion rich-country SDRs to countries in need.

Read the full African Catholic Bishops and religious leader statement here.

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Presbyterian Mission Features Aldo Caliari on the International Debt Crisis

Presbyterian Mission features Aldo Caliari on the International Debt Crisis, private creditors, and the New York Taxpayer and International Debt Crises Protection Act. Below is a brief excerpt, and click here to read the full article.

Call to New York Presbyterians: Take Action on International Debt Crisis

By Aldo Caliari

In May, New York State Assembly member Patricia Fahy, Chair of the Banks Committee, introduced legislation that would ensure private creditors participate in debt relief initiatives at the same level as the US government, other governments and other creditors. Under the New York Taxpayer and International Debt Crises Protection Act, a debtor country cleared to have debt cuts in an international initiative would be protected from private creditor litigation. Should a private creditor sue, the legislation requires that the judge reduces their claim by the same proportion agreed in the applicable global debt initiative. Of course, with such ruling expected, the hope is that most creditors will likely not choose to go to court at all. Debtor countries can manage crises more efficiently, finding a quicker exit and lowering the economic and social costs to their people, especially the most vulnerable.

Read more here.

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IMF Provides Emergency Food Crisis Loans

Washington DC – The IMF launches the Food Shock Window to aid countries facing food shortages by expanding access to rapid, low-interest loans. The number of people facing food shortages rose by more than 200 million since the pandemic.

“All over the world people are struggling with food shortages because of the pandemic, the Ukraine war and soaring prices spurred by inflation,” said Eric LeCompte, Executive Director of Jubilee USA. "The IMF's action helps countries wrestling with food crises."

In 45 countries, 50 million people are on the verge of famine, the World Food Programme reported.

“The growing global food crisis can push countries into social unrest and instability,” added LeCompte. “While the Food Shock Window helps, it is only buying time. More loans as many countries struggle to pay debts is not a long-term answer."

Sixty per cent of the poorest countries and 30 per cent of developing middle-income ones are at risk of debt crises. 

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Available for interview: Eric LeCompte, Executive Director
Contact: Mizraim Belman Guerrero, Communications and Outreach Director
[email protected] / (202) 430-6975

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Hurricane Fiona Damage Adds to Puerto Rico Aid Needs, Debt Woes

Washington DC  Hurricane Fiona caused floods and cut power across Puerto Rico as more than 2 feet of rain fell on the island. The category 1 storm - which strengthened to category 3 after hitting the island - comes five years after Hurricanes Maria and Irma led to 3,000 deaths and more than $100 billion in damages. Since then, Congress allocated $55 billion in disaster aid. The aid is still not fully disbursed and deployed. Additional recovery needs for Hurricanes Maria and Irma are estimated at $50 billion.  

“Fiona is the latest disaster to hit Puerto Rico,” said Eric LeCompte, Executive Director of the religious development group Jubilee USA Network. Jubilee USA Network has worked on debt and disaster relief efforts for the island since 2015. “Puerto Rico will need more aid to address the damages from Hurricane Fiona, the island's child poverty crisis and recovery from previous disasters."

In March, Puerto Rico concluded a bankruptcy process that took over four years and yielded cuts of about 50% of the island's $72 billion debt. In a statement, 26 Puerto Rico and US religious leaders welcomed the agreement but laid out a comprehensive economic agenda needed to prevent future debt crises. The plan includes building quality and sustainable infrastructure.

“Storms will continue to strike Puerto Rico and the electricity grid must be repaired to withstand future storms," stated LeCompte. "While debt relief for Puerto Rico is helpful, not enough debt was cut for Puerto Rico to be prepared for situations like Hurricane Fiona."

The religious leaders’ Puerto Rico plan calls for expanding manufacturing jobs, increasing disaster relief and winning the same funding as US states receive for nutrition, child poverty, health, disability and tax relief programs.

Read Religious Leaders Statement on Puerto Rico Debt Deal and Way Forward here.

Read Jubilee USA's Press Release on US and Puerto Rico Religious Leaders Statement here.

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Available for interview: Eric LeCompte, Executive Director
Contact: Mizraim Belman Guerrero, Communications and Outreach Director
[email protected] / (202) 430-6975

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Religious Leaders: New York Debt Bill Helps Solve Economic Crises in Developing Countries

New York and US Taxpayers, Global Economy Benefit from Legislation

Washington DC – Religious and labor leaders explained that New York laws can provide debt relief for countries struggling from the pandemic and shocks from the Ukraine war. Speaking at a press conference in the New York State Capitol Building, they expressed support for legislation introduced by Assemblymember Patricia Fahy, Chair of the Banks Committee.

“New York is the world’s global financial hub — positioning us well to enact basic changes that will ensure debt relief for developing nations through investments in sustainable growth, infrastructure and more,” said Fahy. “Not only will this legislation protect U.S. taxpayers, it will spur new development and growth within the global economy, reduce stress on international supply chains, and establish clear strategies for growth in nations burdened by massive amounts of debt.”

The New York Taxpayer and International Debt Crises Protection Act (A. 10595) ensures private creditors participate in debt relief initiatives at the same level as the US government, other governments and other creditors. Over 50% of the world's debt held by private creditors is contracted under New York State law.

“The pandemic pushed many developing countries into debt and economic crises,” stated Eric LeCompte, Executive Director of the religious development organization Jubilee USA Network. “Countries can get help resolving debt crises under New York law and the new legislation ensures countries get the relief they need. Because we trade with these countries, resolving debt crises helps resolve supply and economic shocks that we face at home.”

At 7:00 PM ET, Jubilee USA Network hosts a panel discussion featuring Fahy and LeCompte. Speakers include, Rabbi Matthew Cutler, Congregation Gates of Heaven Synagogue; Rev. Dustin Longmire, Messiah Lutheran Church of Schenectady, New York, and former President of the New York Council of Churches; Rev. Nicolle D. Jean-Simon, Pastor of Duryee Memorial African Methodist Episcopal Zion Church and NAACP President of Schenectady Branch #2175; Rev. Dr. Amaury Tanon-Santos, Executive Director of Schenectady Community Ministries and President of the Labor Religion Coalition of NY State; and Ron Deutsch, Executive Director of New Yorkers for Fiscal Fairness.

Watch livestream event “Funding Food, Vaccines and the Environment in Developing Nations,” at 7:00 PM ET.

Read NYS Assemblymember Patricia Fahy’s Office Press Release here.

View the NY Taxpayer and International Debt Crisis Protection Act and Bill Memo here.

Read a previous Jubilee USA press release on the bill here.

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Available for interview: Eric LeCompte, Executive Director
Contact: Mizraim Belman Guerrero, Communications and Outreach Director
[email protected] / (202) 430-6975

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Executive Director Eric LeCompte Speaks with Madison Public Radio on Student Debt Cancellation

Eric speaks with WORT 89.9 a Madison, WI public radio on student debt cancellation. Hear the full interview here

LeCompte: How Student Debt Cancellation Affects Communities

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Annual Federal Reserve Wyoming Meeting Hosts Central Bank Heads to Improve Global Economy

Inflation, Recession and Developing Country Debt Top Agenda of Jackson Hole Meeting

Washington DC – The future of interest rates and the threat of stagflation – a phenomenon where the economy and jobs shrink while inflation rises -- dominate the agenda at a three-day global central bank retreat starting on Thursday. This year’s traditional Jackson Hole, Wyoming symposium gathers the US Federal Reserve and other world central banks under the theme "Reassessing Constraints on the Economy and Policy."

“The meeting is focused on trying to tame inflation without causing more harm for developing countries in crisis,” said Eric LeCompte, Executive Director of the development group Jubilee USA Network. “We are reminded by the challenging decisions world leaders faced with the economy in the 1970s. At this point with greater threats to the global economy, we are in uncharted waters."

The US Federal Reserve raised interest rates more than two percentage points since the beginning of the year and consumer prices rose the fastest in four decades. The combination of interest rate increases and a strong dollar raises debt levels in developing countries. In July the IMF reported that debt in 60 percent of the poorest countries and 30 percent of emerging middle-income economies reached critically-high levels.

“While lowering inflation is important, we need to keep in mind the global impacts of increased debt, food crises and supply shocks that can undermine the economic stability we hoped to achieve through lower inflation,” shared LeCompte.

On Friday, Federal Reserve Chair Jerome Powell addresses the Jackson Hole meeting.

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Available for interview: Eric LeCompte, Executive Director
Contact: Mizraim Belman Guerrero, Communications and Outreach Director
[email protected] / (202) 430-6975

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Biden Cancels Student Debts and Extends Loan Payment Suspension

Washington DC – The Biden Administration announced plans to cancel $10,000 in student debt for borrowers earning under $125,000 a year. Borrowers who received a college federal Pell grant, given to students that have the greatest need, qualify for up to $20,000 in student debt relief. The White House action extended a freeze on student loan payments that President Trump initiated in 2020 as part of pandemic relief. This is the fifth time President Biden continued the moratorium on student debt payments.

“President Biden’s historical student debt cancellation is a bold step that goes beyond previous support and will help vulnerable communities,“ said Eric LeCompte, Executive Director of religious group Jubilee USA Network. LeCompte's organization advocated for the student relief measures with the Biden and Trump White House. “Soaring food and gas prices are putting more pressure on vulnerable communities still reeling from the pandemic.”  

Jubilee USA mobilized thousands of messages to Congress and the Trump and Biden White Houses urging student debt relief to help confront the economic crisis spurred by the coronavirus.

“While the student loan forgiveness helps those hit by the pandemic and inflation, more student debt relief will be needed,” added LeCompte. 

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Available for interview: Eric LeCompte, Executive Director
Contact: Mizraim Belman Guerrero, Communications and Outreach Director
[email protected] / (202) 430-6975

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Jubilee USA Network Statement on G20 Finance Ministers Meeting

Washington DC – The G20 finance ministers concluded their meetings in Bali, Indonesia. The ministers focused on the global economy impacted by the pandemic, Ukraine war, high country debt levels and rising inflation. 

Eric LeCompte, Executive Director of the religious development group Jubilee USA Network and a United Nations finance expert who tracked or participated in G20 meetings since 2010, releases the following statement on the G20 finance ministers meeting:

“The lack of a G20 finance ministers communiqué means it will be more difficult for the G20 to forge a consensus on vital issues in the fall.

"Tensions over Russia's war in Ukraine translated to the G20 failing to take more action on inflation, food shortages and pandemic response.

“Internal divisions hinder the G20’s ability to act decisively and leaves the world in uncharted waters.

“Countries lack the resources to deal with food shortages and we are concerned that the food shortages can lead to unrest.

“As more countries risk defaulting on their loans, we face more threats for stability of the global economy.

“We are waiting for the G20's debt reduction framework to be running so developing countries can receive relief to address food shortages and respond to the pandemic.

“A critical part of the G20 meetings was reviewing proposals that can increase development bank lending by hundreds of billions.

“Getting more resources to development banks would be a significant step to prevent future pandemics and food crises."

Read Jubilee USA's press release about the meetings here.  
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G20 Finance Ministers Meeting Focuses on Response to Global Economic Crises

Washington DC  On Friday, G20 finance ministers descend on Bali, Indonesia, to discuss a global economy impacted by the pandemic, Ukraine war, high country debt levels and rising inflation. Food shortages, climate and tax issues will also be on the agenda at the two-day talks.

“Developing countries lack the resources to confront economic crises and food shortages,” said Eric LeCompte, Executive Director of the religious development group Jubilee USA Network. “The G20 must act quickly to prevent a recession and address food and debt crises."

The World Bank warns that due to the impacts of the pandemic and the Ukraine war, average incomes in 40% of developing countries will remain below 2019 levels.

"Rising interest rates mean developing countries have higher debt payments just when they need to invest more to protect their people,” added LeCompte. “Countries need debt relief, not more debt."

Three countries applied to a G20 debt reduction process created in 2020 and have yet to see any debt relief.

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Available for interview: Eric LeCompte, Executive Director
Contact: Mizraim Belman Guerrero, Communications and Outreach Director
[email protected] / (202) 430-6975

Read More