The United Nations General Assembly High Level Dialogue on Financing for Development
New York, New York
Eric LeCompte, Executive Director of Jubilee USA
September 26th, 2019
(Transcribed and prepared for distribution)
Thank you. It’s an honor to be here with you today. Many of us have worked together and have known each other since we forged the Addis Ababa Agreement in 2015.
As we talk about the challenges of debt crisis it’s important to know that we are dealing with a new emerging debt crises, and developing countries and small island development states are some of the countries that are most at risk. In particular, in light of the reality that we struggle with more extreme weather events that are challenging poor countries from Mozambique to Antigua and Barbuda to Dominica - we must urgently solve these problems.
In the 2017 hurricane season, we saw Dominica and Antigua and Barbuda get devastated by hurricanes, and while they were devastated, they made payments on debt.
That money should have been used for recovery efforts, for disaster and relief efforts. We’re dealing with a serious moment where we need to look at how do you solve problems, both in terms of climate action and debt. Some of the proposals that we agreed on at Addis Ababa specifically addressed this.
Our strongest agreements at Addis Ababa were on debt.
Number one, it was the first international agreement to stop the predatory behavior of vulture funds, which takes advantage of poor indebted countries.
Number two, we agreed that we need to have stronger, improved debt restructuring processes in order to tackle debt. And number three, we highlighted the need for improving debt restructuring and resilience in small island development states.
Right now, we have active proposals to be able to deal with these particular challenges. These particular challenges are solvable. We made agreements on them. The UN General Assembly passed a road map on debt and part of the reason that we must solve it right now is, according to the UN Conference on Trade and Development, in the developing world, it is deterring fast into an extreme debt crisis and the International Monetary Fund notes that forty-seven percent of low-income countries, as of August of 2019, are either in debt crisis or at very high risk of debt crisis.
Thank you very much. We’ve done it before we can do it again.
We have agreements that we have made that we need to move forwards and implement. Together working in this room, we have won more than $130 billion in debt relief because of the HIPC and MDRI initiatives that our countries all worked on together.
Because of those initiatives, we saw 54 million kids go to school in Africa who never would have seen the inside of a classroom. In 2015 again we came together during the Addis Ababa Action Agenda and we made solid agreements about dealing with debt crisis, stopping financial crisis, and raising revenue in the developing world. We must and we can implement these agreements.
Number one, this past week, for the first time in modern history, the only other time being in 1992, there were 6 named major storms in the Atlantic and the Pacific, storms that could become hurricanes. We’re dealing with more extreme weather events.
Over the last two years during the FFD process, we’ve talked about the need about debt relief in the face of natural disasters. We need to have debt relief and debt moratoriums in place when small island development states and Caribbean countries face disasters. It’s an imperative.
Number two, we need to implement the agreement from Addis Ababa on strengthening and legalizing responsible lending and borrowing. The developing world is losing hundreds of billions of dollars a year because of a lack of public budget transparency, because of a lack of responsible lending and borrowing.
Number three, we must implement the strengthening of debt restructuring that we agreed upon in Addis Ababa. We need to move forward a super bankruptcy process as the UN General Assembly already moved forward in 2014.
This week, Jubilee USA, AFRODAD, EURODAD, LATINDADD, 1500 organizations endorsed a bankruptcy process on the principles for neutrality, independence, transparency and expediency that are needed to resolve debt crisis.
And we know its possible because in 2016 the US Congress, Republican led passed a super bankruptcy process for Puerto Rico to deal with its 72 billion dollar debt, and although that process was not perfect, it was the first legislation in the United States to stop and combat vulture funds. We know how critical it is to move forward with this process if we’re serious about dealing with debt challenges.
And finally, we must deal with curbing revenue loss.
Countries around the world, wealthy countries, poor countries, developing countries, developed countries, are forced to borrow when they don’t have money in their banks.
And that’s what we’re seeing happening.
The International Monetary Fund just released a very powerful report highlighted by Forbes noting that 15 trillion dollars a year is lost in tax havens and anonymous shell corporations. What does that break down to? Well the UN Conference on Trade and Development says we can fund the entire sustainable development goals with 5 to 7 trillion dollars.
What does 15 trillion dollars in tax havens break down to? Well, that is more money than the combined economies of China and Germany. That’s how significant it is and why we must stop it.
We know that if we move forth the sustainable development goals, according to the business commission, that by 2030, we will create 12 trillion dollars in new market opportunities. By 2030, we will create 380 million new jobs.
We have solutions in front of us. A global tax body has been debated and must be implemented. We see legislation moving forward in the US Congress, the Corporate Transparency Act.
These four areas we must move forward in order to fulfill the sustainable development goals and the reality of stopping 22,000 children dying every single day in our world because of extreme poverty, according to UNICEF.