Constance Ikokwu
8 November 2007
Washington, DC — The case for the cancellation of multilateral debt owed by developing countries including Nigeria, was yesterday heard at the United States (U.S.) Congress on Capitol Hill. Four people gave testimony on why the Bill must be passed.
They are the National Coordinator of Jubilee USA Network, Neil Watkins and Co-Director, Foreign Policy in Focus, Institute for Policy Studies, Ms Emira Woods.Others are the Counselor, Office of International Justice and Peace, U.S. Conference of Catholic Bishops, Mr Gerald Flood and Director, Rethinking Bretton Woods Project, Centre of Concern, Mr Aldo Caliari. All argued vigorously that the Jubilee Act for Expanded Debt Cancellation and Responsible Lending should be passed, to stop further drain on resources of developing countries who continuously service debt.
Nigeria stands to benefit hugely from this legislation if and when passed into law. The country's multilateral debt, which currently stands at $3.5 billion could be cancelled, provided she is able to prove that debt forgiveness would benefit her citizens by way of improved financial management practices, good human rights record and budget transparency.
Those who testified argued forcefully, presenting data to back up their case.
Watkins said the poverty-reducing expenditures in countries that have received debt relief have increased from $5.8 billion in 2000, to an estimated $17 billion in 2006, or from seven per cent to nine per cent of GDP on average. African governments have also increased social spending by $2 on every dollar freed up from debt service, he stated.
Watkins said tworld's poorest and low-income countries, (in which category Nigerial falls), continue to send $100 million each day to the U.S .government, the International Monetary Fund (IMF), the World Bank, other wealthy nations and creditors. 23 out of 41 of such countries are paying more on debt servicing as a percentage of their gross national income than they were 11 years ago, he argued.
The Jubilee Act would make 24 additional low-income countries not currently eligible for the HIPC/MDRI eligible for debt cancellation from the U.S. and other international financial institutions, provided they embark on budget transparency, use the money judiciously, improve their human rights record and public financial management.
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