IMF Proposes $50 Billion Vaccine Plan to End Pandemic and Boost Economy

Washington DC – As worldwide COVID cases peak, IMF chief Kristalina Georgieva unveiled a $50 billion proposal to support vaccinations of 60% of the world's population. During a G20 and European Commission summit, Georgieva argued the global vaccine investment would end the pandemic and spur $9 trillion in economic gains by 2025.

"Economic forecasts for most countries are grim,” said Eric LeCompte, Executive Director of the religious development group Jubilee USA. “Unless we can get most of the global population vaccinated quickly, most countries will be worse off in coming years and all countries are likely to face economic shocks.”

The IMF says their vaccine plan could be funded through public and private donations and cheap loans.

In April, the IMF and G20 supported the creation of $650 billion in global reserve funds, known as Special Drawing Rights. Up to $400 billion of these pandemic crisis response funds could be donated to support additional needs of developing countries.

“Rich countries can donate their new reserve funds or Special Drawing Rights to support vaccine distribution in developing countries,” shared LeCompte. "It's critical that wealthy countries act now and support global vaccinations. If we don't act, more lives will be lost and the global economy will suffer."

Read the IMF proposal here

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US Pledges Aid, Vaccines and Climate Solutions at Vatican Conference

A High Priority is Debt Relief, Says Treasury Secretary Yellen in Address

Washington DC – Debt relief for poor countries is a high priority for the US, shared Treasury Secretary Janet Yellen in virtual remarks at a Vatican meeting of global finance leaders and Catholic dignitaries. A G20 debt reduction process is in place for poor countries, but developing middle-income countries cannot access the process. During Yellen's address, she lifted US support for developing middle-income countries to qualify for debt relief.

“Yellen's participation in this Vatican event shows the synergy between the pandemic response priorities of Pope Francis and the US Treasury,” said Executive Director of the religious development group Jubilee USA Network. LeCompte advises the Vatican on economic issues and organized a meeting between high-level religious leaders and Yellen in March. "The Pontifical Academy of Social Sciences did an incredible job convening leaders to confront the current crisis."

“Dreaming of a Better Restart,” the conference that Yellen attended, focused on economic policies to combat inequality, climate change and food insecurity.

Yellen remarked on US support for creating $650 billion of emergency currency, known as Special Drawing Rights (SDRs). While developing countries will receive more that $200 billion of these new resources, more than $400 billion is received by wealthy countries. Yellen stated the US wants to donate their share of SDRs to poor countries.

“The support of the US to get as many new resources to developing countries is critical,” stated LeCompte. “More resources are needed to get vaccines to developing countries. Less than 2% of vaccines have reached poor countries.”

The US recently signaled support to waive pharmaceutical patents to increase access for COVID-19 vaccines and therapies.

On climate, Yellen repeated that the US will use its full power to tackle climate change. May 24th is the sixth anniversary of Pope Francis’ encyclical on climate change, ‘Laudato Si.’ 

"Yellen's powerful comments on climate change to this special Vatican conference come as we are celebrating the Holy Father's landmark teaching on protecting the environment," shared LeCompte.

Read Secretary Yellen's Speech here.

View the agenda and read about the Jubilee USA Treasury High-Level Religious Leader Roundtable here.

Read Treasury's readout and release on the High-Level Roundtable here.

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IMF Approves Sudan Debt Relief Plan

Washington DC – On Monday, the International Monetary Fund approved a plan to pay for Sudan's debt owed to the financial institution. Using grants and internal resources, IMF leadership agreed to clear $1.3 billion in missed debt payments or arrears.

“The IMF approved an important step in the process for Sudan debt relief,” said Eric LeCompte, Executive Director of the religious development group Jubilee USA Network. "As Sudan wrestles with the pandemic and a 50% poverty rate, debt relief cannot come soon enough."

Sudan is on track to join thirty-seven countries that received debt relief under the Heavily Indebted Poor Countries Initiative, a plan won by debt relief advocates in the early 2000s.

“An important part of Sudan's debt relief process is that Sudan produces a poverty reduction plan," shared LeCompte who serves on United Nations finance expert groups.

If Sudan meets IMF economic reforms and clears remaining missed debt payments, the country could qualify for an 85% reduction of its $50 billion debt by June.

Read about Sudan's debt process and the US role in relief here.

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U.S. Catholic Features Jubilee USA on Global Response to the Pandemic

U.S. Catholic features the United States Conference of Catholic Bishops and Jubilee USA Network joint letter to the Biden Administration for global debt relief. Read an excerpt below, and click here for the full story.

It’s time to reform global lending, say U.S. Bishops

By Kevin Clarke

In a joint letter in February, the interfaith religious development group Jubilee USA Network and the United States Conference of Catholic Bishops urged the Biden administration to take the lead in preventing such lamentable trade-offs. Their appeal calls for a short-term response to address immediate humanitarian needs this year, freezing debt servicing, and forgiving some loans outright. But the letter writers also argue that long-term reform of global lending practices has to be a part of a rational response to prevent a rinse and repeat of such crises. Too often resource-rich-but-capital-poor states accept debt deals that promise prosperity but just as often deliver economic and social catastrophe.

Cornering poor counties into trading emergency spending on public health for debt payments will definitely mean a higher death toll and the likelihood that the pandemic will continue longer than it has to. In that sense a merciful response on debt is a wise investment for all, helping economies around the world return to normalcy faster and with fewer casualties. No one should be forced to choose between life and debt.

 

Read the full article here.

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Rome Reports Quotes Eric LeCompte on Global Economic Recovery

Rome Reports features Eric LeCompte on the Vatican's commitment to debt relief for developing nations. Read an excerpt below, and click here for the full story.

Religious groups shift attention to economic crisis following the Covid-19 pandemic

By Justin McLellan

The World Bank and the International Monetary Fund held a series of Spring meetings earlier this month to discuss the global economic recovery from the Covid-19 pandemic. 

Ahead of the virtual conference, Pope Francis addressed a letter to the meetings' participants, urging them to seek an equitable and sustainable recovery plan that recognizes the needs of developing nations, in particular the estimated 52 countries currently experiencing a debt crisis.

"This is an issue that the Catholic Church has been a leader on since 1997 when Pope John Paul II aligned the jubilee year of the Church with a campaign for debt relief," said Eric Lecompte, Executive Director of Jubilee USA Network.

For Pope Francis, debt relief is not only a financial question, but a matter of respecting human dignity. Relieving the burden of debt of so many countries and communities today, is a profoundly human gesture that can help people to develop, to have access to vaccines, health, education and jobs.

 

Read the full article here.

Read the full article in Spanish here.

 

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Bloomberg Quotes Eric LeCompte on China's Lending Framework for Low-Income Countries

Bloomberg quotes Eric LeCompte on China's unilateral large-scale lending to low-income countries. Read an excerpt below, and click here for the full story.

China and Its Lenders Have to Join the Global Club

By Michael Schuman

Perhaps more importantly, Beijing must become far more transparent about its lending. China has been notoriously secretive about its aid programs. A 2019 study by the National Bureau of Economic Research in Massachusetts found that half of all Chinese overseas loans to developing countries have been “hidden,” as in not properly reported. This is in part the fault of the borrowing governments. But Beijing often insists on this secrecy.  An analysis of Chinese loan contracts co-authored by Parks and released in March discovered that “the Chinese contracts contain unusual confidentiality clauses that bar borrowers from revealing the terms or even the existence of the debt.” This could easily muck up restructurings by making other creditors wary of cooperating due to a dearth of clarity on China’s loans.

Beijing ought to release its debtors from these stipulations when necessary to assist the restructuring process. Better still, the Chinese government should become more proactive in detailing the extent of its lending. The Organization for Economic Cooperation and Development manages a program for creditor countries to report their development assistance. China should participate.

Most of all, Beijing has to resist its urge to go its own way. Doubts remain that Beijing is fully committed to the G20 framework. Eric LeCompte, executive director of Jubilee USA Network, a coalition of organizations focused on anti-poverty issues, told me he believes “China’s preference is to be able to go it alone,” and cut its own deals.


Read the full article here.

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Crux Features Eric LeCompte on Waiving IP Protections for COVID-19 Vaccines

Crux features Eric LeCompte on President Biden's support to waive intellectual property protections for COVID-19 vaccines. Read an excerpt below, and click here for the full story.

Catholics debate Biden’s waiver of property rights for vaccines

By John Lavenburg

In conversations with Crux, officials from Catholic Relief Services (CRS) and Jubilee USA Network touted waiving IP protections on the vaccines – copyrights, patents, trademarks and trade secrets –  as an essential step towards ending the pandemic.

“What we’re saying in this instance is that this is a disease that’s ravaging the entire globe,” said Emily Wei, director of policy for CRS. “We’re not going to eradicate it until everyone is vaccinated and you reach that herd immunity.”

CRS estimates that reaching herd immunity will take an estimated 11 billion doses to vaccinate 70 percent of the world’s population (assuming two doses are given per person).

Eric LeCompte, executive director of Jubilee USA NETWORK also acknowledged the point that these vaccines are essential for stopping mutations and variants “that could re-infect people in the north if the developing world doesn’t get access to vaccines.” But, he also noted there’s a great global economic impact to not helping these countries get back on their feet.

 

Read the full article here.

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Sudan Debt Relief Moves Forward

US Plays Major Role in Sudan Relief Effort

Washington DC – Under a debt relief plan won by advocates in the early 2000s, Sudan could see a drastic cut in its $50 billion debt this summer, according to the IMF and the World Bank. 

“Sudan’s debts would be cut by 85% under the debt relief plan,” said Eric LeCompte, Executive Director of the religious development group Jubilee USA Network, which was a major force for the creation of the debt reduction process. “Debt relief cannot come soon enough for Sudan as the country struggles with the pandemic and a 50% poverty rate."

Thirty-seven, out of thirty-nine eligible countries, received debt relief under the Heavily Indebted Poor Countries Initiative or HIPC. In order for Sudan to receive a debt reduction it must meet IMF economic reforms and clear missed debt payments. The United States loaned $1.1 billion to Sudan to clear debt payment arrears to the World Bank and convened creditors to secure debt relief.

"The United States is an important leader in Sudan debt relief and is playing a crucial role in expanding debt relief policies during the pandemic," shared LeCompte, who worked with Republican and Democratic administrations for more than a decade on debt policies. "This relief for Sudan can support economic growth and stabilize a hard-won peace in a country where conflict raged for 17 years."

After Sudan obtains debt relief, Eritrea remains the lone country that could qualify under the HIPC debt relief plan won by Jubilee USA.

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US Supports Removal of Vaccine Trade Barrier

Washington DC - As developing countries struggle to access vaccines, the US announced support to eliminate trade barriers on vaccine access. In a statement Wednesday, the Biden Administration called for a waiver on COVID-19 vaccine intellectual property patents at the World Trade Organization.

“Less than 2% of vaccines reached poor countries,” said Eric LeCompte, the Executive Director of the religious development organization Jubilee USA Network. "Intellectual property rights prevent developing countries from making their own vaccines or accessing generic versions."

The IMF states that uneven vaccine access is a main cause of global economic uncertainty. 

"When the majority of countries are not accessing vaccines, the virus continues to mutate and could reinfect vaccinated people in wealthy countries," noted LeCompte. "Continuing coronavirus waves, in any part of the world, mean economic shocks from exports and imports for every country."

President Biden pledged $4 billion to a global fund to help poor countries acquire safe and effective vaccines.

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Eric LeCompte Addresses Special UN Session on COVID Response

United Nations ECOSOC Special Session on Small Island Developing States, Least Developed Countries and Landlocked Developing States: 
Financing a resilient recovery from the cascading effects of COVID-19 

23 April 2021

"The Promise of a Post Pandemic World Where We All Have Enough"

By Eric LeCompte, Executive Director, Jubilee USA Network
(Remarks as prepared for delivery)


Your Excellencies, it's good to be with you for this critical high-level event on COVID response for Small Island Developing States (SIDs), Landlocked Developing Countries (LLDCs) and some of the world's poorest countries or Least Developed Countries (LDCs). I'd like to especially thank His Excellency, Munir Akram for focusing us on countries struggling with specific disadvantages from the crisis.

As we are all aware, we face the most serious crisis of our lifetimes and no country has escaped the economic or health crises spurred by the wrath of this pandemic. 495 million jobs lost, 265 million more people face famine, 95 million more people entered the ranks of extreme poverty over the last year and millions of lives lost to COVID. From wealthy countries to poor countries, jobs are gone and millions of children experience hunger for the first time. 

With great sadness, we question whether our dream to reach the Sustainable Development Goals will ever be a reality. Will we have the ability to muster the political will not only to emerge from resilience from this great crisis, but to ensure our goals to end poverty, address inequality and protect our planet are realized?

Small islands, poor countries and landlocked nations faced considerable risks and vulnerabilities before the pandemic struck. The COVID pandemic made the situation worse and too many countries are left out of global agreements to deal with the crisis. These countries struggle to provide vaccines and lack aid to support jobs, address climate change and feed their people.

While this morning we highlighted the vulnerabilities unique to small islands, now we focus on the challenges and the solutions for the poorest, Least Developing Countries and Landlocked Developing Countries.

Let's be clear about the unique challenges LDCs and LLDCs face.

LDCs face acute vulnerability: relatively small economic size, sluggish progress of structural transformation and heightened dependence on external aid and finance, institutional weaknesses, political instability and in too many cases, conflict.

The proportion of the global poor in the LDCs more than doubled since 1990. Nearly half of the population in LDCs live in extreme poverty, compared to 12% in other developing  countries.

Economic growth is highly volatile in the poor LDCs. These are countries extremely vulnerable to external shocks such as sharp swings in trade, commodity prices, disasters and  pandemics. Before COVID we remember the shock to the three West African countries to Ebola.

LDCs suffer from aid dependence. Official Development Assistance (ODA) accounted for one third of total external development financing of Least Developed Countries in 2014–2017, as compared with just 4.5 per cent for all other developing countries.

The level of concessionality decreased –this is true for developing countries in general, but especially hits Least Developed Countries because they are so aid dependent. Grants are stagnant. The proportion of loans in total ODA disbursements to LDCs increased by more than 10 percentage points between 2011 and 2017, surpassing 25 per cent in 2017.

Before the pandemic, LDCs total stock of external debt more than doubled between 2007 and 2017, jumping from $146 billion to $313 billion. As of May 2019, 18 of the 46 LDCs covered by the Debt Sustainability Framework of the World Bank and International Monetary Fund, already faced debt crisis. These countries are relying more on commercial creditors and of bilateral non-Paris Club creditors.

While many Least Developed Countries are Landlocked developing countries, they all share in common challenges that are exacerbated by the corona crisis. Unsustainable debts, lack of health infrastructure, tax evasion, the relative size of the informal economy compared to the formal economy, weak tax administration systems, corruption, illicit financial flows and underperforming public institutions are some of the challenges.

More deeply LLDCs lack infrastructure – which they need to offset geographical constraints or "landlocked" constraints. An estimate of 2018 put infrastructure financing requirements to cover all components of infrastructure from 2018 to 2030 in the LLDCs to $180 billion or $15 billion a year in 2010 dollars. Their dependence on transit through neighbors made them more exposed to negative impacts because of restrictions the COVID response required.

The last great point of concern for both LDCs and LLDCs, is the lack of vaccine access. For the LDCs and LLDCs, across Africa - for example - less than 1% of their populations have been vaccinated.

Given the problems LDCs and LLDCs face, let us examine a few critical solutions to address the pandemic, have a chance of emerging from the crisis with resilience and get us back on track towards reaching the Sustainable Development Goals. Let me frame four areas that need our immediate attention for LDCs and LLDCs:

1.) Taxation - The US Treasury and IMF call for a global minimum corporate tax, is important and will raise global revenues. While we move towards consensus on this tax, this year, we must also acknowledge a common digital tax which could help raise the most significant revenues for developing countries.

2.) Increasing Aid flows - The countries we are discussing today need support. Two areas that are important are a reboot and increase to development banks to support highly concessional lending. These banks need more than $200 billion replenishment to deal with the needs of these countries. Additionally, with consensus moving forward on accessing global reserve funds or Special Drawing Rights (SDRs) of $650 billion, the $224 billion that will be immediately generated for developing low-income and middle-income countries will be essential. Now our conversation must turn to ensuring that the remainder $400 billion plus is reallocated in ways to support the needs of the countries we are discussing. SDRs reallocation should come as grants, not as more debt.

3.) Expanding debt reduction and transparency efforts is critical in several ways.

In terms of the G20 Common Framework to reduce debts.

A.) We need to be sure that all countries we are discussing can access debt reduction. So the framework needs to be expanded to include Middle-Income Countries that need relief, several of the landlocked countries we are focused on today.

B.) A promising feature of the Common Framework is that countries need to request comparable treatment from private sector. In spite of UN, US, G20, World Bank and IMF calls for the private sector to participate, much of the private sector continues to resist. Given LDCs and LLDCs are more dependent on commercial and private lending, these countries need the private sector to participate. We must ensure that the Common Framework compels comparable treatment from the private creditors.

C.) Given that these countries will likely continue to face debt challenges, we need to begin the conversation on how the Common Framework can lay the groundwork for a permanent facility.

D.) Beyond the Common Framework discussion, every country can protect themselves with the power of debt transparency. I urge all Small Island Developing States, Least Developed Countries and Landlocked Developing Countries to publish the terms of private and public debt contracts in a vehicle available for public review - before, the contracts are signed. This can be done in a national registry or newspaper. Taking this action would also remove the chief concern of the private sector on publicizing this information: competitiveness. Because all debt contracts would be publicly and transparently available, the issue of competitiveness becomes moot.

4.) Vaccine Distribution - Again, of the LDCs and LLDCs we discussed today in Africa, less than 1 percent of their populations have been able to access one dose of the vaccine.

A.) We must move forward a vaccine patent waiver so more production can move forward.

B.) Wealthy countries must start donating their surplus of vaccines to developing countries.

The vaccine question is critical for these countries in terms of economic growth, revenue raising and achieving debt sustainability. Dealing with vaccine equity for developing countries is linked to wealthy economies as well. The longer that developed countries lack vaccine access, wealthy countries will face challenges with exports and imports. The longer we wait to vaccinate the developing world, the more virus variants and mutations will evolve and re-infect people in all countries and affect northern economies.

In closing - according to the most recent IMF data - most countries will be in worse shape post pandemic. Only two will experience more certain recovery, the United States and China. Even in these countries, poverty and inequality increases.

My largest concern is that as some countries experience differing degrees of recovery, we will forget the majority of countries whose suffering increases. After previous crises, such as in 2008, we saw the world come together on bold solutions that would prevent future crises and address inequality. While agreements were reached, implementation failed. Had we improved debt restructuring, dealt with tax issues and corruption and put in place financial crisis resolution tools before this crisis - the pandemic would not have spurred the greatest economic crisis since the Great Depression. It's critical in the coming months and years, we mobilize the political will to implement solutions. Implementing solutions now will help us deal with the current crisis and prevent future crisis.

My organization, Jubilee USA, represents all major religious groups. Inspired by the scriptures of Jews and Christians and the teachings of Islam, we believe in God's promise to us - the Jubilee Promise. We are promised to live in a world where we are all protected from having too little or too much. A promise where God shared with us a rich and abundant world and we are closest to the Creator when we share those resources among one another.

Download Eric LeCompte's remarks as a PDF here.

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Jubilee USA Statement on President Biden’s Leaders Summit on Climate

Washington DC – On April 22-23 President Biden hosted more than 40 world leaders for a virtual climate summit. Biden announced a new US target to halve fossil fuel emissions by 2030 and eliminate them by 2050, and pledged to double annual public climate finance for developing countries by 2024. He also unveiled an international climate finance strategy prepared by Treasury.

Eric LeCompte the Executive Director of religious development group Jubilee USA Network, releases the following statement on President Biden’s Leaders Summit on Climate:

“The summit encourages greater climate action at upcoming G7, G20 and UN meetings.

“Biden's summit is important because it included leaders from countries of all sizes and regions. We can only address climate change together and Biden is bringing a broad range of participants together. 

"The summit included business and labor groups, climate activists and the Pope.

“The guest list conveyed, better than any amount of words, the intention to listen to all and build broad-based support to tackle the climate crisis.

“Treasury vowed to align international financial policies with climate objectives.

“Treasury Secretary Yellen sees that developing countries can succeed on the climate agenda if we also focus on global pandemic response and development.

“For many countries the ability to invest on sustainable, resilient, low-emission infrastructure hinges upon decisive solutions to their dire debt situations."

Read Jubilee USA's release on White House and Treasury climate commitments at the Leaders Summit on Climate here.

Read President Biden's speech at the Leaders Summit on Climate here.

Read Secretary Yellen's speech at the Leaders Summit on Climate here

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United Nations Convenes High-Level COVID Response Session for Vulnerable Countries

Washington DC – The United Nations convened on COVID response and development needs for vulnerable, small island and landlocked countries. The President of the Economic and Social Council, Pakistan Ambassador Munir Akram organized the high-level event to focus on countries struggling with specific disadvantages from the crisis.

“Small islands, poor countries and landlocked nations faced considerable risks and vulnerabilities before the pandemic struck,” said Eric LeCompte, Executive Director of Jubilee USA Network and one of the primary speakers at the session. “The COVID pandemic made the situation worse and too many countries are left out of global agreements to deal with the crisis."

The pandemic set back progress towards achieving the Sustainable Development Goals, targets the international community adopted in 2015, for the countries discussed during the special UN session today.

“These countries struggle to provide vaccines and lack aid to support jobs, address climate change and feed their people,” noted LeCompte.

High-level speakers at the session include Gaston Browne, Prime Minister of Antigua and Barbuda; Mia Mottley, Prime Minister of Barbados; José Ulisses de Pina Correia e Silva, Prime Minister of Cabo Verde; Eisenhower Nduwa Mkaka, M.P., Minister of Foreign Affairs of the Republic of Malawi; Aiyaz Sayed-Khaiyum, Attorney-General and the Minister for Economy, Public Enterprises, Civil Service, Communications and the Minister responsible for Climate Change of Fiji; Rabab Fatima, Permanent Representative of Bangladesh to the United  Nations  and  Co-Chair  of  the  Preparatory  Committee  for  the  Fifth  UN  Conference on LDCs; Baroness Patricia J. Scotland QC, Secretary-General, Commonwealth Secretariat; Lindsey Zuluaga, White House Director for International Economic Policy, National Security Council, USA; Jose Antonio Ocampo, Chairperson of the Committee for Development Policy of the Economic and Social Council; Mr. Umberto de Pretto, Secretary General of the International Road Transport Union; Eric LeCompte, Executive Director of Jubilee USA Network and Fekitamoeloa Utoikamanu, Under-Secretary General and Special Representative of the Office for Least Developed Countries, Landlocked Developing Countries and Small Island Developing States.

The UN session takes place from 10:00 to 1:00 PM and 3:00 PM to 5:00 PM New York Eastern Daylight Time.

Read the schedule and speakers here.

View the special UN session live and see recordings here.

Read Jubilee USA Network Executive Director Eric LeCompte's Speech here

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