Critical COVID Aid Could Reach Developing Countries in August

The International Monetary Fund Executive Board agreed to create $650 billion of emergency currency known as Special Drawing Rights (SDRs) to help countries deal with the fallout from the coronavirus health and economic crises. The IMF’s main governing body, the Board of Governors, will take a final vote in coming weeks to move forward the SDRs creation. In a statement, IMF Managing Director Kristalina Georgieva indicated she expects the allocation as soon as August. 

Nearly 270 groups Call on G20 to Curb Tax Avoidance, Support Debt Relief and COVID Healthcare

The International Monetary Fund approved a debt relief process for Sudan, according to the country's finance ministry. The Heavily Indebted Poor Countries (HIPC) initiative, a debt relief process created in the early 2000s, will wipe out 85% of Sudan's debt, reducing debt from $50 billion to $8 billion.

"Sudan needs debt relief as the country emerges from 17 years of conflict and almost half of Sudan's people live in poverty,” said Eric LeCompte, the Executive Director of the religious development group Jubilee USA Network, which campaigned for the HIPC process more than 20 years ago. “Debt relief for Sudan means reducing child poverty and growing the country's economy."

In March, the United States loaned $1.1 billion to clear Sudan’s debt payment arrears to the World Bank and convened creditors to secure debt relief. A process also moved forward to cut Sudan's IMF debt in arrears.

“As Sudan struggles with the health and economic impacts of the coronavirus, debt relief is a critical resource for recovery," shared LeCompte.           

Sudan is the 38th country to benefit, out of 39 countries eligible for the HIPC initiative. Eritrea is the remaining country.

Aldo Caliari and Jubilee USA are featured in the Norwegian newspaper Bistandsaktuelt on the IMF's new $100 billion in Special Drawing Rights (SDRs) to developing countries. Read an excerpt in English below, and click here for the full story.

IMF Will Secure $100 Billion to Developing Countries in Crisis

By Asle Olav Rønning

Aldo Caliari, head of policy-making at Jubilee USA Network , an organization that works to help debt relief for developing countries, says the planned expansion of the IMF's SDRs is a step forward. He points out that a number of actors have worked intensively for more than a year from the time the proposal first came out until it is now time to adopt it.

At the same time, he believes the needs are even greater than what is now on the table. SDRs are not a precise tool, because they are a scheme that applies to all countries.

Jubilee USA Network argued for an SDR allocation of 300 billion dollars precisely because of the skewed distribution, where only about a third of the amount goes to developing countries, Caliari writes in an email to Bistandsaktuelt.

He refers to estimates from the IMF that low-income countries alone will need $200 billion to get through the pandemic, and another $250 billion to return to the same development path for economic growth as high-income countries.

Read more here.

Reuters features Eric LeCompte and Jubilee USA Network on the IMF's new trust regarding pandemic aid and climate change. 

Read an excerpt below, and click here for the full story.

Exclusive - IMF eyes new trust to provide aid to broader group of countries - Georgieva

By Andrea Shalal

The IMF expects its board to formally approve the $650 billion SDR allocation in August, paving the way for member countries to donate their unneeded reserves to others in need.

The previously unreported new trust could help broaden the effort and make funds available to more countries, and for broader initiatives, in line with global goals for combating climate change.

Eric LeCompte, an adviser to the United Nations and executive director of Jubilee USA Network, said the IMF’s work on the new trust marked “significant progress” for many middle income countries also hit hard by the pandemic.

“It means that more countries with needs can get aid and resources to get through the pandemic,” he said.

Read more here.

The presidents and prime ministers of 7 of the world's wealthiest countries gather in the United Kingdom to meet on the response to the economic and health crises spurred by the coronavirus. Hosted in the seaside town of Cornwall this weekend, the G7 Summit focuses on global vaccine distribution and tax, debt, aid, trade and climate policies.

“As developing countries struggle with a third wave of the coronavirus, it's clear that the world faces a prolonged economic crisis,” said Eric LeCompte, a United Nations finance expert and leader of the religious development organization Jubilee USA Network. “The only way to beat the dire economic forecasts is to distribute vaccines quickly and provide debt relief and aid to developing countries."

Less than 2% of COVID vaccines reached poor countries. The International Monetary Fund asserts the global economy will lose $9 trillion if vaccines are not distributed by 2022 to developing countries.

On Wednesday, the World Trade Organization began a vaccine patent waiver process that could help developing countries produce and procure more vaccines.

“Unfortunately, G7 leaders still have not come to an agreement on waiving the pharmaceutical patents on vaccines,” remarked LeCompte. "More and more people will die as wealthy countries wait to waive COVID vaccine patents."

As a part of the coronavirus response, the G7 supports a debt relief process for poor countries and agreements to curb corporate and digital tax avoidance.

"The G7 tax deal could help boost revenues that countries need to get through the crisis," shared LeCompte.  "While G7 support of debt relief is critical as we confront the pandemic, the G7 should support expanding relief to assist more developing countries in need."

During the summit, the G7 will discuss a $650 billion creation of Special Drawing Rights, a special IMF reserve currency, to respond to the corona economic crisis. Specifically, the G7 will review how these emergency funds can assist developing countries access vaccines, reduce poverty and fight climate change.

“The Special Drawing Rights could be a critical source of funding for the IMF's $50 billion plan to end the pandemic," stated LeCompte.

Read about the WTO vaccine patent waiver process here.

Read Jubilee USA's statement on last week's G7 finance ministers meeting and communiqué here.

Read the Jubilee USA Network press release on last week's G7 finance ministers meeting here.

Read about the IMF $50 billion plan to end the pandemic here.

A Common Dreams article features Eric LeCompte on the World Trade Organization's (WTO) talks to waive patent rights for the COVID vaccine. Read an excerpt below, and click here for the full story.

'Shame It's Taken So Long': Health Advocates Welcome Formal WTO Talks to Suspend Covid Vaccine Patents

By Kenny Stancil

A recent analysis by a coalition of humanitarian groups estimated that at the current vaccination rate, it would take low-income countries 57 years to fully vaccinate their populations against Covid-19.

"Without enough vaccines, developing countries continue to lose lives and jobs," said Eric LeCompte of Jubilee USA Network, whose advocacy work includes pushing for equitable medicine access in trade agreements. "We must move as fast as possible so all people can receive coronavirus vaccines, therapies, and medical equipment to respond to the crisis."

LeCompte added that "unless we act quickly on global vaccine access, most of the world's countries will see lost decades of development. As the crisis worsens in developing countries, wealthy countries will face more economic shocks."

As epidemiologists and advocates for a "people's vaccine" have stressed since the beginning of the pandemic, the more chances the virus has to mutate, the more the lives and livelihoods of millions of people around the world are endangered.

Read the full article here.

Friends,

• We had a major victory as the G20, G7, and US agreed to create $650 billion in global reserve funds (Special Drawing Rights). Developing countries will receive over $200 billion in emergency support
  
  
• We won a historic G20 debt reduction process for developing countries suffering from the COVID health and economic crisis. This is the most significant debt relief and anti-corruption process we have won to date with 73 poor countries gaining access to new resources to confront the COVID crisis. Three have already requested relief
  
  
• After 10 years of work, the Corporate Transparency Act passed Congress. Our bipartisan bill sheds light on anonymous shell corporations which shield human traffickers, steal debt relief and enable tax evasion and corruption

PS. When you make a gift now to support Jubilee USA's efforts, it will be doubled. Please join me and donate now.

A Reuters article quotes Eric LeCompte on the G7 nations' discussions to create a minimum global corporate tax rate. Read an excerpt below, and click here for the full story.

UPDATE 1-G7 nations near historic deal on taxing multinationals

By David Milliken

Rich nations have struggled for years to agree on a way to raise more revenue from large multinationals such as Google, Amazon and Facebook, which often book profits in jurisdictions where they pay little or no tax.

U.S. President Joe Biden's administration has given the stalled talks fresh impetus by proposing a minimum global corporation tax rate of 15%, above the level in countries such as Ireland but below the lowest level in the G7.

"All countries face revenue loss when corporations don't pay their share in taxes," said Eric LeCompte, executive director of Jubilee USA, an alliance of organisations promoting debt relief.

"The G7 needs to support global tax reforms so we have resources for people to get beyond this pandemic," he added.

Read the full article here.

G7 finance ministers met in London to discuss global COVID-19 response, vaccines, debt relief and global tax reform.