Jubilee Letter to the IMF on Reserve Gold Funds

April 1, 2020


Kristalina Georgieva
The International Monetary Fund
700 19th St NW,
Washington, DC 20431

 

"And the crowds asked him, “What then shall we do?” And he answered them, “Whoever has two tunics is to share with him who has none, and whoever has food is to do likewise.” --- Luke 3:10-11

 

Managing Director Georgieva,

Since Jubilee USA leadership wrote you on March 23rd, we are pleased to see some critical Fund responses to protect the vulnerable and all of us from financial crisis in the face of the coronavirus.

We welcome the following actions: 

  • The expansion and use of the Catastrophe Containment and Relief Trust to provide debt relief and health service aid for the poorest countries in the world
  • Increased financing to support all countries who need resources to prevent financial crisis, increase social protection floors and ensure workers can continue to be paid
  • The calls of the IMF and World Bank to the G20 to suspend all debt payments for the 76 poorest countries in the world
  • Support of the G20 and world leaders to come up with a comprehensive action plan on debt vulnerabilities by mid-April
  • Exploring processes with the G20 and Financial Stability Board to protect us from a global financial crisis

The above actions are positive steps and we are grateful for your leadership in moving forward these vital actions.

We believe the Fund should take additional, deeper actions to expand debt relief, aid to the poorest countries in the world as well as offer greater relief to the so-called Middle Income Countries.

This is possible if the fund were to access the $140 billion we believe to be held in the IMF's gold sales reserve. These monies should be utilized to expand debt relief for the 76 poorest countries and other developing countries.

If our calculations are correct, based on the latest IMF financial statements available from 2019 and calculating the current price of gold, we believe the fund has about $140 billion in a "rainy day” fund. We are witnessing a growing storm, perhaps the worst economic hurricane we will ever see in our lifetimes. The time to utilize and access these monies is now.

In our work together, we've accessed these monies before. In 2010 when Haiti was devastated by an earthquake and in 2014 when Sierra Leone, Guinea and Liberia fell prey to the Ebola epidemic, these funds were creatively used to cancel debt and provide emergency aid.

While the expansion of the Catastrophe Containment and Relief Trust is an incredible step, due to the limited funds in the account, 29 countries may be eligible for partial debt relief and aid. The funds available in the SDA gold sales reserve could provide full cancellation and additional aid for many countries facing great need. 

Further, we invite the IMF and World Bank to also suspend debt payments for poor and developing countries.

We again point to our letter of March 23rd and the analysis and four point plan that we detailed to lift the vulnerable and prevent a global financial crisis. Generally, that letter encourages urgent action along these points:

  • Expand debt relief and aid for developing countries impacted by COVID-19 through the Catastrophe Containment and Relief Trust and other processes
  • Enhance debt restructuring, issue debt payment moratoriums and create expedient debt reprofiling processes for countries impacted by the coronavirus
  • Mobilize additional financing resources to support increased needs
  • Advise countries on public budget transparency, financial crisis prevention and raising revenues

Managing Director Georgieva, we know that we are likely confronting the worst economic and health crisis in our lifetimes and we look forward to continue working with you to take bold, urgent and needed actions for our survival.

In hope,

Eric

Eric LeCompte
Executive Director

 

Full letter PDF here

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United Nations Agency Calls for $1 Trillion COVID-19 Debt Relief Package

Vatican Official Calls for "Jubilee"

Washington DC -  A United Nations agency that predicted the 2008 financial crisis is calling for $1 trillion in debt relief for developing countries to battle the economic impacts of the coronavirus. 

"We are in a recession and likely facing the greatest financial crisis since the Great Depression," stated Eric LeCompte, the Executive Director of the religious development group Jubilee USA. "Massive debt relief and aid is needed as developing countries attempt to withstand the economic shocks caused by the coronavirus."

A report released from the United Nations Conference on Trade and Development says debt payments should be suspended and ultimately eliminated for developing countries. The report further urged more than a trillion additional dollars be made available to support these countries struggling to withstand financial crises caused by the virus. Last week the International Monetary Fund and World Bank called on the G20 to suspend debt payments for the world's 76 poorest countries. 

On Monday, Vatican official, Cardinal Luis Antonio Tagle called for a "Jubilee" and for wealthy countries to relieve the debt of poor countries. On Sunday, Pope Francis warned that a "viral genocide" would take place if world leaders prioritized economic growth over the health of people.

"We can only get through this crisis if countries around the world have the ability to do similar stimulus packages that the United States and European countries are doing," stated LeCompte whose organization detailed a plan for the IMF on surviving a global financial crisis spurred by the coronavirus. "Debt relief, aid and financial crisis protections must urgently move forward so we can live through this pandemic."

Read the United Nations Conference on Trade Development Report here

Read Jubilee USA's Letter to the IMF on COVID-19 here

Read More

Fox News, New York Times, Associated Press Cite Eric LeCompte on IMF, Recession

The Associated Press quoted Eric LeCompte on the IMF Director Kristalina Georgieva's global recession remarks. Fox News, The New York Times, US News and World Report and tens of thousands of other news outlets included Eric's comments in their stories around the world. Read an excerpt below, and click here for the full story.

IMF head says global economy now in recession

“IMF efforts that start to offer debt relief to the poorest countries and that increase financing to help prevent a global financial crisis are really positive and needed steps,” said Eric LeCompte, the executive director Jubilee USA, a group that campaigns for increased assistance for low income countries.

Read more here
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Coronavirus, Crisis Work - Gifts Doubled Now

Friends,

I pray that you and your loved ones are well.

Thanks to your partnership, we have the chance to fully win campaigns we've worked on for nearly 25 years. While our strategic efforts make significant gains every year - we are in a moment where world leaders are seriously reviewing our proposals to stop financial crisis, protect the vulnerable and address extreme poverty.

After weeks of meetings and strategic planning, on Monday morning Jubilee USA's leadership sent a letter to the head of the IMF detailing a plan to bolster healthcare for the world's poorest people and protect all of us from a financial crisis. Our multi-year advocacy and strategic high-profile efforts achieved a lot this week. In a time that is so challenging, we're grateful to be heartened by so many victories.

Will you please make a gift and support Jubilee USA today? All gifts are doubled now and support our life-saving, transformative work.

  • Yesterday, the IMF agreed to our proposal to expand debt relief and provide grant-like aid, as the coronavirus spreads, to the world's poorest countries to bolster healthcare. They are using a mechanism we pushed for and created to deliver relief to Haiti after its earthquake 10 years ago and then transformed to deal with the 2014 Ebola epidemic

  • This week, the IMF and World Bank took up our G20 call to suspend debt payments to the 76 poorest countries in the world

  • The IMF announced it will double its capacity to provide emergency financing and aid to all countries that need it to prevent financial crisis in the face of the coronavirus

  • On Wednesday, after two years of work, the IMF supported the plan to reduce Somalia's debt from $5 billion to $577 million

  • This week our views appeared in tens of thousands of newspapers and outlets around the world like: Fox News, the New York Times, the Miami Herald, the Minneapolis Star Tribune, CNN, NBC, ABC, CBS and the Associated Press

Your contributions now also help us work with and push Congress, the G7, G20, IMF, World Bank and the White House as we expand financial crisis and debt crisis resolution tools in the United States and at the United Nations and the International Monetary Fund. While we’ve made much progress since the 2008 financial crisis, now world leaders are looking more closely at full implementation of many of our proposals.

As our coronavirus campaigns move forward, Jubilee USA continues our campaigns to end extreme poverty and address inequality. In early February, we met with Pope Francis, the head of the IMF and a dozen finance ministers to move forward our campaigns on debt, tax, trade, corruption, transparency, climate and disaster aid. During our day together, we were concerned how shocks like the coronavirus can disrupt both wealthy and poor economies. When Pope Francis addressed our small group, he endorsed all of our campaign efforts.

Your tax-deductible gift now is also vital for us to continue our other campaigns at this time.

  • Congress passed and President Trump signed our nearly $6 billion request in healthcare aid for Puerto Rico earlier this year. We also expedited the release of hurricane relief funds. As earthquakes continue to shake the island, we worked with the House to pass nearly $4 billion in aid. We need your help to move the Senate as we work to secure more disaster aid and assistance for Puerto Rico in 2020 as they also wrestle with the coronavirus. In the stimulus package we won more aid for Puerto Rico. With your support over the coming year, we must move forward tens of billions of dollars of additional aid

  • We just won the next phase of debt relief for Somalia. After two years of work, the IMF approved debt relief and President Trump signed our legislation into law. We moved Congress and the International Monetary Fund to pass Somalia debt plans which mean building new roads, women's empowerment, kids going back to school and ending the tragic reality that 73% of people live in extreme poverty. Over the next months, we'll need your help to further move the White House, Congress, the IMF and the Paris Club to authorize and fund the debt relief

  • Our work on climate debt and finance is critical now. Ahead of climate negotiations this year, Jubilee USA is organizing religious communities to ensure that our policies are included in the agendas

  • Our interfaith, bipartisan NAFTA, US Mexico Canada trade campaign won all of our goals. We stopped predatory "vulture" funds from using trade deals to collect on old bad debts. We ensured that most abusive corporations can't exploit trade deals to take advantage of poor people or local laws. We removed the language that would keep medicines and drugs unaffordable for vulnerable communities and all of us. We organized the largest denominations in the US to work with us on this critical campaign and will continue these trade efforts in 2020. We were joined in this work by the leadership of the Presbyterian, Lutheran, Episcopalian, Methodist, Catholic and United Church of Christ Churches. Our work now focuses on 4 countries and a possible Congressional vote in May on access to medicines for all of us

  • We won support from the White House and passed our Jubilee Corporate Transparency Act in the House of Representatives. Once we pass it in the Senate, this legislation helps stop human traffickers, protects debt relief and development aid and raises revenue in the developing world. We are close to a deal in the Senate and organized almost 100 faith communities to work with us to move this forward. We expect our Senate vote in the next few months and need your support to push this across the finish line

  • We continue our strategic efforts on student debt and payday lending. Your support helps us weigh in at critical moments with state governments, Congress and the White House

Please make a tax-deductible gift and support our Jubilee work today. Your gift is needed, has a big impact and is doubled today.

Gratefully,

Eric

Eric LeCompte

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We Won! Covid-19 Debt, Somalia, IMF Jubilee plan

Friends,

We are sharing some good news amidst these trying times.

Together - we just won three of our campaigns in the last 48 hours! And since we launched our coronavirus campaigns, we see mind-blowing progress every day.

  •  Moments ago the IMF agreed to our proposal to expand debt relief, as the coronavirus spreads, to the world's poorest countries to bolster healthcare

  • The IMF just announced it will double its capacity to do below market-rate lending to all countries to prevent financial crisis in the face of the coronavirus

  • On Wednesday, after two years of work, the IMF supported the plan to reduce Somalia's debt from $5 billion to $577 million

Almost everyday this week we saw the IMF and world leaders endorse parts of our Covid-19 plans to lift the vulnerable and protect all of us from financial crisis. After weeks of preparation and engagement, Jubilee USA's leadership sent a three page letter outlining a detailed global coronavirus plan to bolster healthcare in the developing world by canceling debt and delivering aid, mobilize additional resources to help all countries prevent financial crisis, use debt moratoriums and better debt restructuring to help countries in distress and raise revenues by curbing corruption, tax evasion and risky market behavior. By Tuesday, you were signing our action alert and sending additional messages to the IMF. While we are winning - we still have more goals we need to move forward right away in our coronavirus fight - so if you haven't signed our petition to the IMF, please sign it now. African Finance Ministers were demanding to stop paying debt to free up $44 billion to fight the virus and Ecuador's congress was raising the alarm on debt payments.

On Wednesday the IMF and World Bank were repeating our calls to the G20 and wealthy countries to stop collecting debt payments because of the coronavirus emergency. The IMF and World Bank wanted debt payments suspended for the world's 76 poorest countries. More than 65% of those who live in extreme poverty call these 76 countries home. In the midst of this, Somalia's debt relief plan was made official. Then on Thursday, President Trump and the G20 had a virtual meeting and discussed parts of our emergency Jubilee USA Covid-19 plan.

Today the Miami Herald did a feature article with Jubilee's Executive Director Eric LeCompte on what our Jubilee Covid-19 plan means for the Caribbean and Latin America.

Just hours ago, the IMF leadership announced more good results from our campaigning. In a statement that was magnified in a press conference from IMF head Kristalina Georgieva, the Fund agreed to debt relief for poor countries and committed to doubling lending resources as 80 countries are requesting emergency financing.

Eric LeCompte's reactions to today's IMF press conference are featured in thousands of newspapers around the world today - read our views in the New York Times and Associated Press.

The Catastrophe Containment and Relief Trust is our debt relief mechanism that can offer debt relief and healthcare grants for poor countries. The mechanism was last used to relieve debt and deliver healthcare grants to Liberia, Sierra Leone and Guinea during the 2014 Ebola epidemic. In 2014, Jubilee USA and our Executive Director, worked with the White House, US Treasury, IMF and G20 to create the Ebola debt relief mechanism. Now that mechanism is being used for the poorest countries as they fight the coronavirus.

Our coronavirus campaigns are just getting going to lift the vulnerable and protect all of us from financial crisis. If you signed our petition, please share it with your friends, family and community.

Donations to support our coronavirus campaigns are doubled now and urgently needed so we can continue this work. Whether you make a gift of $5 or $500, your contribution is tax-deductible and needed and goes directly to supporting our coronavirus work.

We are so grateful to work on these critical efforts with you.

In hope,



Kate Zeller
Campaigns Director

Twitter: @katejbu
https://jubileeusa.org/support-us

P.s. In days, we'll release our Jubilee USA coronavirus action report. Please be on the look out for it and please consider a tax-deductible gift that will be doubled so we spread and promote our findings.

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Eric LeCompte's Thoughts on Coronavirus Impact in Miami Herald

The Miami Herald interviewed Eric LeCompte on the impact of the coronavirus and global economic slowdown in Latin American and the Caribbean. Read an excerpt below, and click here for the full story.

COVID-19 is hitting Caribbean and Latin American economies hard. Can they survive?

Eric LeCompte, who leads the development group Jubilee USA and serves on United Nations debt expert groups, said there is a way that countries like Jamaica can be helped. Lenders like the World Bank and International Monetary Fund need to expand debt relief to all countries.

“It should not only be for the poorest countries but Caribbean countries and Latin America countries should be able to qualify for that expanded debt relief. That’s what we’re pushing,” LeCompte said. “Countries need to prioritize fighting COVID-19 and billions can be freed up right away by halting debt payments.”

LeCompte said the IMF and the World Bank are calling on wealthy nations to allow for debt payment moratoriums. But most countries in the Caribbean, despite being among the world’s highly indebted, do not qualify for such moratoriums or lower-interest loans because they are considered to be middle-income countries. But they should qualify, he said.

“We have more than 11 Caribbean economies that are facing debt distress. Across the Caribbean youth unemployment is high on almost every island; we have poverty rates that range between 20 and 45 percent in many of the small islands,” LeCompte said. “Even if the coronavirus doesn’t lead to the type of major financial crisis, or even depression some economists are forecasting, no matter what, the Caribbean will be one of the worst impacted areas by even short-term economic shocks.”

Read more here

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IMF Announces Coronavirus Debt Relief and Increased Lending Resources

Washington DC -  As the coronavirus continues to take lives and wreak havoc on health systems and the economy, the International Monetary Fund announced plans for debt relief for poor countries and increased lending resources for all countries. 

"Debt relief and aid to bolster health systems in developing countries is urgently needed," said Jubilee USA Executive Director Eric LeCompte. LeCompte's organization sent a letter to the IMF on Monday urging debt relief, increased below market-rate lending and improving debt restructuring processes. "IMF efforts that start to offer debt relief to the poorest countries and that increase financing to help prevent a global financial crisis are really positive and needed steps."

On Friday, IMF leadership announced the news in a statement that was magnified in a press conference from IMF head Kristalina Georgieva. The Fund committed to doubling lending resources as 80 countries are requesting emergency financing. The Catastrophe Containment and Relief Trust is the debt relief mechanism that can offer debt relief and healthcare grants for poor countries. The mechanism was last used to relieve debt and deliver healthcare grants to Liberia, Sierra Leone and Guinea during the 2014 Ebola epidemic.

"While increased debt relief resources are welcome, the relief and healthcare aid is only for the poorest countries. The IMF must ease debt relief restrictions so all developing countries can receive debt relief and healthcare grants," stated LeCompte, a United Nations finance expert who worked with the IMF, G20, US Treasury and White House to develop the Ebola debt relief mechanism.

Read the IMF's Press Conference Minutes here
Read Jubilee USA's Letter to the IMF on COVID-19 here

 

Read More

G20 Emergency Meeting Convenes on Coronavirus Health and Economic Impacts

Washington DC -  Saudi Arabia chaired an emergency virtual G20 meeting for Presidents and Prime Minsters as the coronavirus wreaks havoc on the global economy. The leaders pledged to pump $5 trillion into the economy, cooperate on health efforts and address debt risks facing poor countries.

"World leaders are incredibly concerned about a crisis that is taking lives and could destroy our economy," shared Eric LeCompte, a United Nations finance expert and Executive Director of the religious development group Jubilee USA. "It's unfortunate that G20 leaders did not commit to the IMF and World Bank calls to suspend debt payments for the world's poorest countries."

On Wednesday, the Fund and the World Bank urged G20 and wealthy countries to stop collecting debt from 76 developing countries. More than 65% of those who live in extreme poverty call these 76 countries home.

"We need the G20 to suspend debt payments. We need to see the IMF and World Bank also use debt payment moratoriums," said LeCompte. "A range of creditors need to provide debt relief for both developing and more developed countries. We need to improve our debt restructuring processes very quickly."

Read the G-20 Statement here
Read Jubilee USA's Letter to the IMF on COVID-19 here
Read the IMF World Bank Joint Statement here
See the Jubilee action alert to the IMF on Covid-19 here
Read More

Somalia Wins Debt Relief

Washington, DC -  The International Monetary Fund and World Bank announced that Somalia qualifies to receive debt relief. In three years time, Somalia's debt will be reduced from $5.2 billion to $557 million.

"Debt relief for Somalia is incredibly exciting news and can't come soon enough," said Eric LeCompte who leads Jubilee USA, a development group that advocated for debt relief for the African country. "Somalia is one of the poorest countries in the world and this relief is vital to confront extreme poverty in the country."

Nearly three quarters of Somalia's people live in extreme poverty, according to the United Nations Development Programme.

Somalia is the 37th country to qualify for debt relief under a global agreement that Jubilee USA and partners won in the early 2000s. The Heavily Indebted Poor Countries Initiative or HIPC process dedicates debt relief for health and education aid for developing countries. The HIPC process also opens the door for Somalia to borrow again.

"Other creditors still need to fund and agree to the process in the months ahead, but this is a huge step forward in the fight against poverty in Somalia," said LeCompte.

Read the IMF Announcement of Somalia Debt Relief here

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IMF and World Bank Ask G20 to Halt Debt Collection for Poor Countries

Washington, DC -  The International Monetary Fund asked G20 countries and other lending countries to stop collecting debt from poor countries due to the coronavirus pandemic.

"We urge lending countries to take up this call so billions of dollars can be freed up for poor countries dealing with impacts of the coronavirus," said Eric LeCompte who leads Jubilee USA. The religious development group sent a letter to the IMF on Monday urging debt payment moratoriums. "Debt payment moratoriums can get money to countries quickly."

In a statement released Wednesday from the Fund and the World Bank, the institutions encouraged wealthy countries to stop collecting debt from 76 developing countries. More than 65% of those who live in extreme poverty call these countries home.

"Confronting the global health and economic impacts of the coronavirus will only be possible if we implement a number of solutions. We need to see the IMF and World Bank also use debt payment moratoriums," said LeCompte. "The IMF will need to provide financing for both poor and more developed countries. Various creditors will need to provide debt relief for developing and developed countries. We need to improve our debt restructuring processes very quickly."

Read Jubilee USA's Letter to the IMF on COVID-19 here
Read the IMF World Bank Joint Statement here
See the Jubilee action alert to the IMF on Covid-19 here
Read More