Call for Action on Canceling Developing Country Debt

Posted to the IUF website 12-Jul-2004

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IUF governing bodies and IUF publications have for many years called for the cancellation of the accumulated foreign debt which is crushing developing countries. While campaigns for debt cancellation have tended to fall from public view lately (though the burden of payment is greater today than ever), economist Jeffrey Sachs (probably the best-known proponent of "shock therapy" in structural adjustment programs, now an economic adviser to the UN secretary general) is now calling on African countries to take unilateral action if the debt is not cancelled.

Sachs, speaking on the eve of an African Union Summit in Ethiopia, said that if the donor countries don't cancel the debt, African nations should cancel it unilaterally. "The time has come to end this charade. The debts are unaffordable. If they won't cancel the debts I would suggest obstruction; you do it yourselves."

Sachs told the BBC "Africa should say: 'thank you very much but we need this money to meet the needs of children who are dying right now so we will put the debt servicing payments into urgent social investment in health, education, drinking water, control of aids and other needs.

As reported by the BBC, Sachs denied that non-payment would bar African countries from accessing future loans from the international capital markets from which they were currently shut out due to...the burden of debt repayment.