Haiti: U.S. administration pledges to relieve debt
NewsNotes, May-June 2009
The Jubilee USA Network, of which the Maryknoll Office for Global Concerns is an active member, enthusiastically welcomed the announcement by Secretary of State Hillary Clinton that the U.S. would pledge $20 million to cover Haiti’s 2009 debt payments to its multilateral creditors as part of an over $50 million aid package to the country.
Haiti currently sends $1.6 million to the World Bank every month while thousands of Haitians starve and funding shortages threaten the nation’s stability.
“Today’s announcement is a victory for the people of Haiti. The U.S. pledge to cover Haiti’s debt service obligations will free $20 million for basic infrastructure, healthcare, and education and will help Haiti to recover from last year’s devastating storms. We are especially grateful for the leadership shown by the Treasury and State departments in achieving this commitment.” said Kristin Sundell, deputy director of the Jubilee USA Network, a coalition of faith-based, development, human rights and community organizations working for debt relief for impoverished countries.
“This is change that Haitians can believe in,” said Brian Concannon Jr., Director of the Institute for Justice and Democracy in Haiti. “It provides much-needed tangible support while righting a historical wrong by removing the burden of Haiti’s unjust and unbearable multilateral debt.”
In February, a bipartisan group of 72 U.S. representatives called on World Bank President Robert Zoellick to immediately suspend all scheduled debt repayments from Haiti and grant complete debt cancellation to the impoverished nation. The letter was circulated by Rep. Maxine Waters (D-CA).
Haiti is projected to complete the IMF’s Heavily Indebted Poor Country (HIPC) Initiative by July. Completion of the program will result in the permanent cancellation of a substantial portion of Haiti’s debt to the United States, World Bank, and Inter-American Development Bank. Haiti was improperly left out of the original HIPC for political reasons. The country was accepted into the program in 2006, but its efforts to catch up have been hindered by economic policy conditions imposed by the IMF and a string of natural disasters, economic shocks and political unrest.
In April, Haitian President René Préval appealed to Secretary Clinton for immediate financial assistance, describing a $100 million budget gap that he said could throw Haiti into anarchy.
The U.S. pledge of $20 million in debt relief is a substantial step toward filling the budget gap, but the date by which Haiti is projected to complete the HIPC program and receive permanent debt cancellation has already been pushed back a number of times by the IMF. Haiti’s debt must still be cancelled outright without further delays.