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US, other lawmakers champion poor nation’s debt cancellation

US SENATOR Bennie Sanders and congresswoman Ilhan Omar have written to the World Bank and IMF requesting extensive debt cancelation for the world’s poorest countries.

In a letter to World Bank Group president David Malpass and International Monetary Fund (IMF) managing director Kristalina Georgieva dated May 13, the pair argue that temporal suspension of the debt would not mitigate the long-term effects of the coronavirus pandemic on poorest countries.

The letter is also supported by members of parliament from 30 countries, including the European Parliament.

“Dear President Malpass and Managing Director Georgieva, Members of Parliament across the world are writing to request extensive debt forgiveness for International Development Association (IDA) countries by all major international financial institutions (IFIs) during this global COVID-19 crisis. We are pleased to see that the World Bank Group (WBG) and International Monetary Fund (IMF) have already taken steps to implement debt relief and suspension for the world’s poorest countries,” the letter reads in part. “The recent IMF announcement of temporary debt relief funding for 25 member countries is an encouraging development but much more widespread and long-term support is still needed. That is why we call on all G-20 leaders through the IFIs to support the cancellation of debt obligations held by all IDA countries during this unprecedented pandemic. The temporary suspension and deferment of debt will not be sufficient to help these countries fully prioritise the prompt and sustainable management of the crisis at hand. The vulnerable communities that lack the resources and privileges to adopt adequate public health measures will ultimately face the disproportionate burden of coronavirus. Such harm means that global supply chains, financial markets, and other interconnected exchanges will continue to be disrupted and destabilised.”

Sanders and Omar state that they have a humanitarian duty to petition for the world’s poorest countries.

“We also urge you to support a major issuance of Special Drawing Rights (SDRs) in order to provide developing countries with urgent financial support. The pandemic-triggered economic crisis is expected to be far more devastating than the global financial crisis of 2009 when SDRs were last deployed. We concur with managing director Georgieva’s ‘lower-end’ estimate of $2.5 trillion for the current financial needs of developing countries. An issuance of SDRs on the order of trillions of dollars will be required to avert major increases in poverty, hunger and disease,” the letter states. “Therefore, not only do we have a humanitarian duty to aid our petitioning countries in dire need, but we also have a common, vested interest to support comprehensive relief for effective recovery and resiliency. As a collaborative international community, we can only begin to move past this pandemic once this pandemic ends for everyone. For those reasons, we urge the WBG and IMF to take strong leadership to provide extensive debt relief and financial assistance for all impoverished nations most at risk of the devastating human costs and the long-lasting economic injuries of COVID-19. We ask that you work with relevant bilateral and multilateral parties to provide a response no more than 15 days after receipt of this letter.”

Sanders, Omar and other legislators indicated that they stood ready to work with the international financiers of debt cancellation.

“It is in our shared public health, security and economic interests that we come together and act boldly to assist the most vulnerable nations among us. We stand ready to work with you and support immediate and long term solutions to ensure fragile, destitute, countries receive the flexibility and guidance they need in order to prevent humanitarian crises, protect public health, and promote global stability during this crisis and well after it is over for affluent nations,” reads the letter.

Other members of parliament include the UK’s Diane Abbott, Ecuador’s Marcela Aguifiaga, Omar Paul Aguilar Condo of Bolivia, Spanish member of Congress of Deputies Mertxe Aizpurua, Finish member of the European Parliament Alvina Alamesta, Monica Aleman from Ecuador, French member of the European Parliament Francois Alfonsi, Daniel Almeida of Brazil, Argentina’s Ana Claudia Almiron, Peru’s Jose Luis Ancalle Gutierrezz, Germany’s European Parliament member Rasmus Andresen, and Bolivia’s Oscar Arellano.

Others are Colombia’s Wilson Arias, Bolivia’s Carola Arraya Borges, Jaber Asaqlar from Israel, Spain’s Miquel Auba i Fleix, Manon Aubry representing France in the European Parliament, Colomba’s Aida Avella, Yuriri Ayala from Mexico City, Sara Bailac Ardanury from Spain, Adam Bandt from Australia, Spain’s member of the European Parliament Pernando Barrena, Monte Bassa I Coll Marta from Spain’s Congress of Deputies, Fernando Bazan Villanueva from Peru, Apsana Begun from the United Kingdom, member of Spain’s Congress of Deputies Marian Beitialarrangoitia, Italy’s member of the European Parliament Brando Benifei, Alejandro Bernales Maldonado from the Chilean Chamber of Deputies, and France’s European Parliament member Benoit Biteau.

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