Drop Nepal’s debt, say anti-poverty groups

Quake-stricken nation due to make debt payments despite continuing crisis

Houses destroyed by the 25 April 2015 earthquake in Nepal (Flickr / European Commission DG ECHO)
Houses destroyed by the 25 April 2015 earthquake in Nepal (European Commission DG ECHO/Flickr)

Jubilee Debt Campaign has joined a call by more than 30 organisations across Asia for Nepal to receive immediate and unconditional debt cancellation in the wake of two devastating earthquakes. It comes on the day (15 May) Nepal is due to make debt payments to the World Bank and the International Monetary Fund.

“We stand in solidarity with our colleagues and the rest of the Nepal in these critical moments. We ask governments, international financial institutions, international banks, and other lenders to do the same by immediately, totally, and unconditionally cancelling the country’s debts,”

said Lidy Nacpil, coordinator of the Asian Peoples’ Movement on Debt and Development (APMDD).

Nepal’s finance ministry reported that the country owes a total of almost $3.5 billion in external debts as of last October. Just above $3 billion are owed to multilateral banks such as the Asian Development Bank and the World Bank. The country is due to spend $210 million on debt repayments in 2015 alone, more than 5% of government revenue. This includes payments over 2015 of $48 million to the World Bank and $14 million to the IMF.

“Already a Least Developed Country, Nepal is pushed back at least by a decade in its development efforts by these devastating earthquakes,”

said Dr. Sarba Khadka of Rural Reconstruction Nepal, an APMDD member organization, which endorsed the alliance’s statement.

The alliance’s other Nepalese member organizations – mostly rural, human rights, and women’s groups currently providing relief support – supported the call along with movements from other countries.

“The advantage of debt cancellation is that it is fast,”

said Jonathan Stevenson of the Jubilee Debt Campaign.

“Funds are freed up immediately for recovery and reconstruction. Instead, today’s payments will mean millions of dollars are flowing out of Nepal at the time of greatest need. Creditors, starting with the World Bank and Asian Development Bank, should take immediate steps to reverse this.”

More than 8,000 people have died and an estimated eight million people have been affected by the first, magnitude-7.8 earthquake which hit Nepal on 25 April. A magnitude-7.3 quake followed on 12 May claiming the lives of at least 76 more.

ENDS

Notes

Jubilee Debt Campaign is a UK-based campaign to break the chains of unjust debt, and for a new financial system that puts people first.

The Asian Peoples’ Movement on Debt and Development (formerly Jubilee South–Asia Pacific Movement on Debt and Development) is a regional alliance of peoples’ movements and organizations, coalitions, and non-governmental organizations. See http://www.apmdd.org

APMDD’s Nepalese members Rural Reconstruction Nepal, Right to Food Network Nepal, Jagaran Nepal, and Campaign for Climate Justice–Nepal support the call for debt cancellation, along with its Nepal-based networks South Asia Alliance for Poverty Eradication and LDC [Least Developed Countries] Watch.

1. A payment of $3.5 million to the IMF is due to be made on 15 May
http://www.imf.org/external/pubs/ft/scr/2014/cr14214.pdf#page=45
And further payments to the World Bank:
http://go.worldbank.org/WM04979650

2. For details of debt statistics and payments, see:
http://www.fcgo.gov.np/wp-content/uploads/QuarterlyDebtPosition_1st_Quarter_2071-72.pdf
http://www.imf.org/external/np/fin/tad/extforth.aspx?memberkey1=690&date1key=2015-03-31&category=forth&year=2015&trxtype=repchg&overforth=f&schedule=exp&extend=y
http://www.imf.org/external/pubs/ft/scr/2014/cr14214.pdf#page=45 http://go.worldbank.org/WM04979650

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