Business Day Quotes Eric LeCompte on the Solutions to the Debt Crises

Business Day quotes Eric LeCompte on the solutions to the developing country debt crises at the IMF and World Bank. Read the excerpt below and click here for the full article. 

Will World Bank, IMF rescue developing economies from growing debt conundrum?

By Kadiri Abdulrahman

At the Marrakech meetings, a coalition of faith-based organisations, Jubilee USA, urged the World Bank and the IMF to stop the debt and food crises of low-income nations.

Eric LeCompte, Executive Secretary of the group, said that it could be done by stopping the “ridiculous policies” of raising interest rates.

According to him, development banks can help address debt crises by ensuring that debt contracts have clauses where debt payments stop in the face of disasters and by promoting swaps, transparency and accountability.

 

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Jubilee USA Statement on IMF and World Bank Meetings and IMFC Press Briefing

On Sunday, the Annual International Monetary Fund and World Bank Meetings conclude. On Saturday, the International Monetary and Financial Committee (IMFC), the IMF policymaking body, met as part of the IMF and World Bank Meetings. The global economy, economic growth, debt, inflation, and expanding IMF resources to respond to multiple crises are in focus on the agenda.

Eric LeCompte, at the meetings in Marrakesh, is the Executive Director of the religious development group Jubilee USA Network and a United Nations finance expert who monitored IMF and World Bank meetings since 2010. LeCompte releases the following statement on the IMFC meeting and the IMF and World Bank Annual Meetings:

"The IMF forecasts the lowest growth in decades.

"In spite of signs of easing inflation, decisionmakers continue to push for raising interest rates in an attempt to stop inflation.

"The flawed policy of raising interest rates means that more developing countries face debt crisis and food and fuel are too expensive for all of us.

"The emerging analysis from the meetings is that in addition to the tragic loss of life that we see in Israel and Gaza, the conflict affects economic stability, global trade and the poor everywhere.

"The Sustainable Development Goals are becoming more difficult to reach given the global impacts of the pandemic, conflicts, inflation and the climate crisis.

"Developing countries spend twice and a half their health budget, and almost four times their education budget on repaying debt.

"More than half of all countries are having trouble paying their debts and meeting the basic needs of their people.

"A report on the work of the Global Sovereign Debt Roundtable shows little progress in fixing the challenges that face debt restructuring and relief.

"Zambia, which applied for a debt restructuring 32 months ago, will leave the Annual Meetings with a formalized debt relief deal with public creditors.

"The meetings agreed on more options for wealthy countries to use their emergency pandemic relief or Special Drawing Rights to help increase the ability of development banks to provide aid and lend.

"It's great news that some countries are increasing contributions for the IMF to increase low-interest lending to poor countries.

"Unfortunately, IMF surcharges on large emergency loans add to debt burdens when countries are already in crisis.

"We expect decisions on increasing IMF resources to fight crises by the end of the year. The voting reforms that are connected with this seem to be stalled."

Read Jubilee USA's press release on the G20 Finance Ministers meeting here.

Read Jubilee USA's statement on the Development Committee Meeting here.

Read Jubilee USA's press release on the Africa Catholic Bishops Annual Meetings statement here

Read Jubilee USA's press release on the IMF World Economic Outlook report and the Global Financial Stability report here

Read Jubilee USA's statement on the IMF Global Financial Stability report here

Read Jubilee USA's statement on the IMF World Economic Outlook report here

Read Jubilee USA's press release on Annual Meetings agenda here.

Read Jubilee USA's press release on IMF chief Kristalina Georgieva's curtain raiser speech here

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Bloomberg and Business Standard Quote Eric LeCompte on Rising Interest Rates

Eric LeCompte is quoted in Bloomberg and Business Standard on the negative impact that the  policy of raising interest rates has on the developing country debt crisis. Read an excerpt below and click here for the full story.

World’s Higher-for-Longer Rate Era Stokes Worry

By Craig Stirling and Eric Martin

In a statement released on Saturday, Jubilee USA Network, a Washington-based non-profit group advocating financial relief for poor nations, criticized the sustained push to hike borrowing costs at a time when the IMF is forecasting weak growth, and inflation is easing.

“The flawed policy of raising interest rates means that more developing countries face debt crisis,” said Executive Director Eric LeCompte. “More than half of all countries are having trouble paying their debts and meeting the basic needs of their people.”

Regarding the overall outlook, there were still words of comfort on offer in Marrakech, notably from Gopinath, who observed that “the core” of the financial system has held together, even if many wouldn’t have predicted that with the extent to which rates have risen.

 


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Reuters, New York Times and US News Quotes Eric LeCompte on the G20 Divisions on Israel/Gaza Conflict

Eric LeCompte is quoted in Reuters, the New York Times, and US News on the divide within the G20 regarding the Israel and Gaza conflict. Read an excerpt below and click here for the full story.

G20 communique omits mention of Middle East conflict

By Andrea Shalal

Failure to mention the violence revealed deep divisions roiling the G20, said Eric LeCompte, executive director of Jubilee USA Network, a coalition of more than 750 religious groups and organisations.

"What's happening in Israel and Gaza is a horrific tragedy and if we can't stand up for the protection of children on both sides, it shows how stalemated they are," he said.

The G20 has been deeply divided since Russia's invasion of Ukraine in February 2022. Its membership includes the United States, European powers, China, Russia, Saudi Arabia, other major economies of Asia, South America and most recently the African Union.

 

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Morocco G20 Finance Meetings Make Few Decisions on Crisis Response

Consensus Document Dodges Israel/Gaza Conflict and Impacts

G20 finance ministers met on global economic growth, debt, inflation, expanding development bank aid, the pandemic and other crises. Meeting in Morocco during the Annual IMF and World Bank Meetings, the ministers reached agreement on a communique, which these ministers had failed to do since the beginning of the Ukraine war in February 2022. 

“The ministers met as a gap grows between the poor and the wealthy and as some countries see modest growth and poor countries are worse off,” said Eric LeCompte, Executive Director of the religious development group Jubilee USA Network. “The G20 made important commitments to boost the lending and aid capacity of the World Bank and other development banks to support developing countries.”  

Officials welcomed an experts group report they commissioned earlier this year to examine the additional capacity multilateral development banks need. The group's chairs are former US Secretary of Treasury Larry Summers and former chairperson of the Fifteenth Finance Commission of India Nand Kishore Singh. It estimates development banks together should ramp up finance and aid by $260 billion annually, as part of an annual $1 trillion external flows to finance climate and development in emerging and developing economies.

"The G20 needs to increase the resources for development banks so countries can emerge from crises and reach their development and climate goals," noted LeCompte. "What they agreed on only increases annual development bank funding by one-twentieth of what experts say is needed."

Inflation is easing in several countries but risks remain and core inflation is persistent, the G20 said.  

“We need to stop raising interest rates. This flawed policy, to stop inflation, hurts all of us," shared LeCompte. "Raising interest rates spurs more debt crises in developing countries and makes food and fuel too expensive for us."

While the World Bank called for the Israel and Gaza conflict to deescalate, the document makes no mention of the events or its impacts on global economic activity.

“It appears the cost of reaching consensus language was to dodge the Israel and Gaza question altogether,” said LeCompte. “Beyond the tragic loss of life, global financial stability and the poor around the world will be dramatically affected."

Read Jubilee USA's statement on the Development Committee Communique here.

Read Jubilee USA's press release on the Africa Catholic Bishops Annual Meetings statement here

Read Jubilee USA's press release on the IMF World Economic Outlook report and the Global Financial Stability report here

Read Jubilee USA's statement on the IMF Global Financial Stability report here

Read Jubilee USA's statement on the IMF World Economic Outlook report here

Read Jubilee USA's press release on Annual Meetings agenda here.

Read Jubilee USA's press release on IMF chief Kristalina Georgieva's curtain raiser speech here

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News24 and the Herald Quote Aldo Caliari on the Africa Catholic Bishops Annual Meetings Statement

Aldo Caliari is quoted by News24 and the Herald regarding the Justice, Peace and Development Commission of the Catholic Symposium of Episcopal Conferences of Africa and Madagascar (SECAM) statement on economic issues in Africa. Read an excerpt below and click here for the full story.

You have to change your approach to Africa, Catholic bishops urge IMF, World Bank

NEWS24 - The senior director of policy for the Jubilee USA Network, Aldo Caliari, said the African bishops should be taken seriously because they knew and lived in affected communities.

"African religious leaders are on the front lines of countries facing debt, climate, and food crises," he added.

Jubilee USA supports and advises African Catholic bishops on economic issues

 

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Jubilee USA Statement on IMF and World Bank Meetings and Development Committee Meeting

The IMF and World Bank's Development Committee, a major policymaking body for the institutions, met in Marrakesh in the context of the IMF and World Bank Annual meetings. The Development Committee and the IMF and World Bank meetings focused on growth, debt, inflation, expanding development bank finance and aid, responses to the pandemic and the climate and food crises.

Eric LeCompte, Executive Director of the religious development group Jubilee USA Network and a United Nations finance expert who has monitored IMF meetings since 2010, releases the following statement on the World Bank and IMF Meetings and the Development Committee meeting:

“As poor growth is forecasted for the global economy it will be very difficult for developing countries to recover from the pandemic and food crises.

“The Bank’s listing of eight global challenges is helpful because they all deal with aspects of poverty.

“It's important that the World Bank wishes to tackle more global challenges, but we have no idea where the money is coming from to tackle these global problems.

“We need to do a better job at responding to the climate, food and inflation crises in the poorest countries. Unless we deal with their high debts, we won't have the resources to address these crises.

“Some good news on getting new resources is that there is growing momentum to increase resources for development banks.

“If wealthy countries donate Special Drawing Rights to development banks, we can put more resources where it is most needed.

“Development banks can help address debt crises by making sure debt contracts have clauses where debt payments stop in the face of disasters and by promoting debt swaps, transparency and accountability.

"We can only stop the debt and food crises by stopping these ridiculous policies of raising interest rates."

Read Jubilee USA's press release on the Africa Catholic Bishops Annual Meetings statement here

Read Jubilee USA's press release on the IMF World Economic Outlook report and the Global Financial Stability report here

Read Jubilee USA's statement on the IMF Global Financial Stability report here

Read Jubilee USA's statement on the IMF World Economic Outlook report here

Read Jubilee USA's press release on Annual Meetings agenda here.

Read Jubilee USA's press release on IMF chief Kristalina Georgieva's curtain raiser speech here

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SECAM Statement to IMF/ World Bank Annual Meetings 2023

The Justice, Peace and Development Commission of the Catholic Symposium of Episcopal Conferences of Africa and Madagascar (SECAM) issued a statement urging world leaders to promote urgent debt relief, aid and lending policies to address the interlinked crises African countries face as the IMF and World Bank Annual Meetings Commence in Marrakesh, Morocco. 

Read the statement here.

Read the press release on the statement here.

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African Catholic Bishops: Marrakesh Meetings Should Act on “True Jubilee of Hope in Africa”

Debt, Finance and Future Lending Policies Urged in Advance of 2025 Jubilee Year

World leaders attending the annual IMF, G20 and World Bank meetings should promote urgent debt relief, aid and lending policies to address the interlinked crises African countries face, noted a body that represents African Catholic Bishops. The statement from the Justice, Peace and Development Commission of the Catholic Symposium of Episcopal Conferences of Africa and Madagascar (SECAM) was issued as the meetings are held for the first time in 50 years in an African location.

“To successfully address debt crises, it is crucial to tackle the complexities arising from multiple creditors. This necessitates the coordination of efficient, prompt, and comprehensive policies that encompass both public and private creditors,” the bishops said.

The statement, “A Call to Leaders Actions for a True Jubilee of Hope in Africa,” follows on Pope Francis’ declaration of year 2025 as a Jubilee year, under the motto “Pilgrims of Hope.” 

The faith leaders pointed out that in Africa nearly 600 million people live in poverty and near 280 million are hungry, calling to remove the obstacle of debt that prevents many countries from having the resources to invest in crisis response and protect their most vulnerable. They recalled that in 1999, then Holy Father St. John Paul II linked debt relief to the fight against poverty, stating that the message remains true today.

The bishops referred to decisions taking place regarding increasing international development banks ability to lend.

“The momentum for reform of international financial institutions presents an opportunity to adapt them according to present needs and requirements. This can be achieved through strengthening human development values in their missions, boosting their financial capital, and improving their instruments for financing,” the bishops said. “Moreover, . . . any additional resources [should come with] increased accountability and meaningful involvement of the communities and societies affected by their programmes.”

The Catholic leaders also asked for policies to prevent new cycles of indebtedness, by “setting foundations for responsible lending and borrowing, debt contract authorization and disclosure safeguards and debt reduction clauses that trigger automatically when debtors suffer natural disasters or other shocks.”

"African religious leaders are on the front lines of countries facing debt, climate and food crises," stated Aldo Caliari, the Senior Director of Policy for Jubilee USA Network. Jubilee USA supports and advises the African Catholic Bishops on economic issues. "Africa Catholic Bishops are calling for real changes in the financial system to protect their people and our planet."

The statement referred to the threat of climate change in Africa, the most climate-vulnerable region and the one least responsible for global warming.

“In the face of a planet that is on the brink of becoming uninhabitable. . . We pray that [our leaders] make choices that promote life, not only for themselves but also for future generations, as it is written: “. . . choose life, so that and your children may live” (Dt 30:19),” they added.

Read the Justice, Peace and Development Commission of the Catholic Symposium of Episcopal Conferences of Africa and Madagascar (SECAM) statement here.

Read Jubilee USA's press release on the IMF World Economic Outlook report and the Global Financial Stability report here

Read Jubilee USA's statement on the IMF Global Financial Stability report here

Read Jubilee USA's statement on the IMF World Economic Outlook report here

Read Jubilee USA's press release on Annual Meetings agenda here.

Read Jubilee USA's press release on IMF chief Kristalina Georgieva's curtain raiser speech here

Join Jubilee USA and partners for IMF and World Bank event: "Defusing the Debt Time Bomb: The Role of an Effective Crisis Prevention and Resolution Architecture." More information here.

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IMF and World Bank Meetings Wrestle with Low Growth, High Interest Rates, Debt Crises and Climate Challenges

Israel and Gaza Conflict Raises Concerns for Global Economy

As world leaders arrive for the Annual IMF and World Bank Meetings, the IMF forecasts the global economy to grow 3% this year, which remains below the average of growth for the two decades before the pandemic.

"According to the IMF, our economy is still struggling to recover from the impacts of the pandemic and other crises,” said Eric LeCompte, Executive Director of Jubilee USA Network, which focused on IMF policies for more than 25 years. "Less financial stability means more conflict, more poverty and more crises."

Both of the released flagship reports, the Global Financial Stability Report and the World Economic Outlook were prepared before the emergence of the Israel and Gaza conflict.

"While the report could not consider the Israel and Gaza conflict, it does see the escalation of the Ukraine war as a financial stability risk," shared LeCompte. "The loss of human life due to war and conflict is unacceptable. Beyond the deaths, conflict also hurts our global economy and the poor everywhere."

The IMF predicts global inflation will fall almost 2 percentage points to 6.9%. The companion Global Financial Stability Report expressed concerns on continued inflation and warned that measures to bring it down will need to continue.

"The growing risks to financial stability are deeply concerning,” shared LeCompte. “But some ways that we fight inflation, like raising interest rates, creates higher debt loads for countries and makes food too expensive for all of us.”

The IMF called for preemptive debt restructurings in the many countries with high debt risks.

"High interest rates mean that developing countries will have higher debt payments that lead to even more debt crises,” noted LeCompte who serves on United Nations finance expert groups. "Quicker and more comprehensive debt restructurings are needed."

An entire chapter of the financial stability publication focused on the role of the financial sector in regards to climate investment needs.

"In developing countries, climate investments will need to rise to $2 trillion per year by 2030. The IMF expects private finance will need to provide the lion’s share of that amount,” stated LeCompte. "Developing countries need resources to tackle climate change. If they don't, it will impact financial stability."

Read Jubilee USA's statement on the IMF Global Financial Stability report here

Read Jubilee USA's statement on the IMF World Economic Outlook report here

Read the full Global Financial Stability Report here.

Read the full World Economic Outlook Report here.

Read Jubilee USA's press release on Annual Meetings agenda here.

Read Jubilee USA's press release on IMF chief Kristalina Georgieva's curtain raiser speech here

Join Jubilee USA and partners for IMF and World Bank event: "Defusing the Debt Time Bomb: The Role of an Effective Crisis Prevention and Resolution Architecture." More information here.

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Global Finance Quotes Eric LeCompte on Post-Pandemic Inequality

Global Finance Magazine quotes Eric LeCompte on the growing inequality since the start of the COVID-19 pandemic. Read an excerpt below and click here for the full story. 

IMF and World Bank Annual Meetings

Post-pandemic economics hobble infrastructure growth.

By Rob Daly

As finance ministers and central bankers from more than 190 countries gather in Marrakesh for the annual meetings of the International Monetary Fund (IMF) and the World Bank Group, what optimism they have is tempered by the flare-up of Middle East violence that threatens to spread and post-pandemic economic realities.

The global economic recovery since the pandemic's start remains uneven, as Kristalina Georgieva, managing director of the IMF, noted in her curtain-raising speech. “[T]he current pace of global growth remains quite weak, well below the 3.8% average of the two decades before the pandemic,” she said. “And looking ahead over the medium term, growth has weakened further.”

The World Bank estimates that the global economy has lost $3.7 trillion in global output, which has hit the lower-income emerging economies the hardest. Meanwhile, the US economy has returned to pre-pandemic growth rates.

 

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Reuters Quotes Eric LeCompte on the Conflict in Israel and Gaza

Eric LeCompte is quoted in Reuters on the attention shifts from IMF and World Bank discussions on economic policy due to conflict. Read an excerpt below and click here for the full story. 

World Bank urges cooling of Israel-Gaza conflict as annual meetings start

By Andrea Shalal and David Lawder

MARRAKECH, Morocco, Oct 9 (Reuters) - The World Bank on Monday urged a "rapid de-escalation" of the fighting in Israel and Gaza as the violence cast a pall over the start of the bank's annual meetings with the International Monetary Fund in Morocco.

An internal World Bank memo seen by Reuters cited a "devastating loss of life, destruction and heavy toll on civilians being incurred on both sides," but voiced support for the lender's work in Gaza and the West Bank.

"We hope for a rapid de-escalation of the conflict and end to the violence. The World Bank and our development partners have long worked to support the poorest, most vulnerable people in the West Bank and Gaza, and we remain committed to building the foundations for a more stable and sustainable future."

 

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