----- Original Message -----
From: "Soren" <[EMAIL PROTECTED]>
To: <[EMAIL PROTECTED]>
Sent: Sunday, September 17, 2000 4:14 PM
Subject: (50 Years) IMF/WB to announce improved debt program
> Below is the lead story in today's (Sunday's) New York Times, which reports
> that the IMF, World Bank, and their leading "shareholders" (the G7
> governments) have agreed to announce another improvement in their debt
> management ("relief") program, the Heavily Indebted Poor Countries (HIPC)
> Initiative. This is the program announced in '96 then revised at the
> Cologne G7 Summit in '99.
>
> As this article is based on "leaks" in advance of the official announcement,
> it is quite short on specifics. The claim is made that many of the most
> onerous conditions linked to debt relief will be set aside so that the
> relief can be delivered more quickly. It is unclear whether the conditions
> being foregone are the structural adjustment programs (SAPs), however -- the
> conditions explicitly referred to in the article are those concerning how
> the proceeds from debt relief will be spent.
>
> The most serious problem with the HIPC program, in the estimation of the 50
> Years Is Enough Network and many others, is the conditioning of its
> often-meager benefits (and in some cases, like Zambia's penalties, since
> they'll be paying more after HIPC for the privilege of seeing some of their
> account numbers go down) on commitment to structural adjustment programs,
> the disastrous policy packages that have devastated 90+ countries around the
> world. Eliminating debt is of limited value if countries still have to
> endure the "austerity" that debt has long condemned them to. In our
> analysis, HIPC is in essence a bribe to persuade governments to stay in the
> "system" as they run out of incentive to pay endless debts and adhere to
> SAPs. We are also convinced that the "bottom line" for those who control
> the IMF and World Bank is the imposition of SAPs -- they may give in on
> other things, but they will not abandon SAPs until they are unequivocally
> forced to by popular opposition. So it will be very interesting to see if
> those requirements are part of the "easing" of HIPC's conditions.
>
> The last paragraph of this article suggests that SAPs will remain part of
> HIPC, and that the changes to be announced in Prague should be examined
> carefully before any celebrations start: "A senior administration official
> said Friday that the Treasury Department had approved the lending agencies'
> expedited approach to debt relief.
> But the official played down the matter as largely "window dressing"
> designed to placate protesters, not completely overhaul the debt relief
> process. He said the United States would not allow nations to pass through
> the debt-relief process unless they commit to approved poverty-reduction
> strategies."
>
> Other interesting points to notice:
>
> - World Bank President James Wolfensohn explains why they're accelerating
> the HIPC process: "This has assumed extraordinary proportions as a political
> matter, and we just have to get it done." Wolfensohn is not always the most
> polished press personality. He can usually be relied to speak of debt as a
> humanitarian issue; here he acknowledges the power of the Jubilee 2000
> movement and the fact that he does not personify the vanguard of progress on
> debt and poverty -- that indeed he is part of the problem and has to be
> forced to move.
>
> - The article also reports that the Bank is planning to announce a new
> "multibillion dollar fund that will provide low-interest loans to nations to
> help them put antipoverty strategies into practice" through which "some of
> the strings attached to debt relief in the past could be fastened instead to
> new loans, giving the lending agencies a continued oversight role without
> hindering debt forgiveness."
>
> Soren Ambrose
> 50 Years Is Enough Network
>
>
> Rich Nations Pledge to Double Countries Getting Debt Relief
>
> By JOSEPH KAHN
>
> WASHINGTON, Sept. 16 2000
> In an era of unprecedented prosperity for rich nations, their financial
> leaders are promising a high-profile campaign to double the number
> of poor nations granted debt relief by year's end.
>
> The commitment would mean easing the conditions usually
> imposed on countries that want debt forgiven, international
> financial officials said.
>
> The pledge, to be announced at the annual meeting of
> international lending agencies in Prague next week, is intended
> to defuse one of the most potent arguments of the
> antiglobalization protesters who have disrupted nearly every
> recent gathering of finance and trade ministers: In times of
> previously unknown wealth, many of the poorest nations have
> become increasingly indebted to the rich.
>
> A senior administration official said Friday that the Treasury
> Department had approved the lending agencies' expedited
> approach to debt relief. But the official played down the matter
> as largely "window dressing" designed to placate protesters,
> not completely overhaul the debt relief process. He said the
> United States would not allow nations to pass through the
> debt-relief process unless they commit to approved
> poverty-reduction strategies.
>
> The drive to relieve more debt by year's end, pushed primarily
> by ministers from Europe, where debt relief has become a
> major political issue, indicates how finance ministers and the
> heads of lending agencies are shifting their priorities.
>
> Just last year, financial officials were still scrambling to prevent
> a panic that had engulfed many emerging markets from setting
> off a global recession. This year, they plan to endorse an array
> of new antipoverty programs, allocating funds to fight AIDS and
> spread education, as well as wipe away old debts incurred by
> the poorest nations in Africa and Latin America.
>
> The focus on poverty is possible, in part, because the world has
> rarely enjoyed better economic health.
>
> The International Monetary Fund, which will release its yearly
> global economic survey next week, predicts that the world
> economy will grow by 4.7 percent this year, faster than at any
> time since at least the late 1980's and, by some measures,
> since the 1960's, when half the world still had closed
> economies.
>
> Of all the leading developed and developing countries, only
> Japan has yet to show robust expansion in a fully globalized
> age.
>
> Under the plan to speed up debt relief, finance ministers will
> streamline cumbersome procedures so that 10 nations, all but
> one in Africa, can begin to use about $17.5 billion that they
> would have had to set aside for debt payments this year.
>
> Unless world leaders had agreed to ease some conditions, they
> might have fallen well short of their own pledge -- first made at
> a global summit meeting in Cologne, Germany, in the summer
> of 1999 -- to forgive the debts of at least 20 nations by 2000.
>
> "We agreed that we have to take this to the limit," said James
> D. Wolfensohn, president of the World Bank. "If we wait to have
> all the i's dotted and t's crossed, we would not make the goal.
> This has assumed extraordinary proportions as a political
> matter, and we just have to get it done."
>
> Mr. Wolfensohn and other officials said global lenders would
> continue to insist that nations that want their debts forgiven
> come up with a strategy for using the liberated funds effectively
> -- ideally for education, health and fighting poverty.
>
> Under heavy United States pressure, lending agencies have
> mandated that debt-relief candidates produce complex
> antipoverty blueprints that include plans for schools, health
> programs and rural development. They must also detail roles for
> the private sector and charity groups, as well as the government.
>
> The requirement was envisioned as a way to ensure that money
> is not diverted to useless or even corrupt purposes.
>
> But the efforts to comply often take many months or even years
> and cost applicants scarce resources to develop. A few nations
> have withdrawn or have threatened to withdraw their
> applications in frustration.
>
> Now, the lending agencies say, they will start granting at least
> some debt relief when a nation produces a far less rigorous
> interim strategy, with full relief granted later when the more
> comprehensive plan is finished.
>
> The World Bank, the International Monetary Fund and other
> major lending agencies have also agreed to relax requirements
> that nations prove they know how to use development aid -- for
> example, by performing well in an ongoing, official lending
> program over several years -- before they can receive debt
> relief. Under the expedited program, that requirement will
> become more flexible, officials said.
>
> Officials believe that the changes will make it possible to finish
> work on at least 10 of 14 applications for debt relief in just three
> months, a much faster pace than the lending agencies have
> maintained to date.
>
> Ten nations have already received debt relief under the longer,
> more rigorous procedures in place.
>
> Among those in a new batch considered likely to have some
> debt forgiven by year's end are Cameroon, Chad, Gambia,
> Guinea, Guyana, Guinea-Bissau, Malawi, Nicaragua, Rwanda
> and Zambia.
>
> The World Bank also plans to announce in Prague that it will
> establish a new, multibillion-dollar fund that will provide
> low-interest loans to nations to help them put antipoverty
> strategies into practice, bank officials said.
>
> The idea is that some of the strings attached to debt relief in the
> past could be fastened instead to new loans, giving the lending
> agencies a continued oversight role without hindering debt
> forgiveness.
>
> The renewed commitment to debt relief is a significant victory
> for a coalition of religious, charity and pressure groups
> worldwide that helped put debt relief on the world agenda
> several years ago.
>
> Many have sharply criticized financial leaders for a go-slow
> approach since then.
>
> About 20,000 demonstrators are expected to turn out in Prague
> for the annual meeting of the World Bank and the International
> Monetary Fund, which begins with low- key meetings this week
> and formally kicks off its session next weekend.
>
> Organizers fear that members of a radical youth underground
> movement in Europe will converge on Prague and pose a major
> crowd- control challenge for relatively inexperienced Czech
> police. As in previous antiglobalization protests in Washington,
> Seattle and Cologne, Jubilee 2000, an umbrella organization of
> debt-relief advocates that stages nonviolent protest, also plans
> to march.
>
> Many of the protesters have argued that globalization tends to
> benefit multinational interests at the expense of the poor. They
> see the heavy debts of developing nations as a case in point.
>
> The critics claim that lending agencies provide billions in loans
> while demanding that nations quickly adopt capitalist ways like
> trade liberalization, free flow of capital, austere government
> budgets.
>
> But the experiment often fails, they say, leaving the poor even
> poorer because, like gamblers on credit, they end up with a
> hangover of high interest payments.
>
> The lending agencies -- and most of the wealthy nations that fill
> their coffers -- do not agree with that analysis.
>
> But, led by a dramatic shift of sentiment in Europe, where the
> Jubilee 2000 coalition has heavyweight political power, the
> lending agencies have embraced sweeping debt relief as a way
> to help poor nations cope with globalization.
>
> Gordon Brown, Britain's chancellor of the exchequer and the
> current head of the committee of nations that sets broad policy
> goals for the lending agencies, has been a champion of debt
> relief, bank and fund officials said. He has insisted that the
> agencies meet their Cologne goal of 20 nations by 2000, even
> though that means easing some conditions.
>
> Mr. Brown's emphasis on accelerated debt forgiveness is at
> odds with the position of Treasury Secretary Lawrence H.
> Summers. Though Mr. Summers also favors debt relief, he has
> insisted that poor nations fully develop their strategies for using
> the money well, even at the cost of denying early relief to some
> of them.
>
> Domestic politics also plays a role. The Republican-controlled
> Congress has been far warier of debt relief than parliaments in
> Europe. Though the Clinton administration is hopeful that
> Congress will eventually agree to provide $435 million for the
> United States' share of debt relief this year, early House
> commitments to debt relief fall short of that mark, and the
> Senate has allocated only a small fraction of the money
> requested.
>
> Mr. Summers has said he fears a significant backlash against
> debt relief in Congress if the relief is doled out willy-nilly, or if a
> nation that gets debt relief is then found to have used the money
> for corrupt purposes.
>
> A senior administration official said Friday that the Treasury Department
> had approved the lending agencies' expedited approach to debt relief.
> But the official played down the matter as largely "window dressing"
> designed to placate protesters, not completely overhaul the debt relief
> process. He said the United States would not allow nations to pass
> through the debt-relief process unless they commit to approved
> poverty-reduction strategies.
>
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