Debt mustn't stand in the way of recovery
Rich countries meeting in Paris today must not only suspend all debt repayments from tsunami affected countries, but go further and cancel a substantial proportion of the debts permanently, international agency Oxfam said today. Any cancellation or moratorium should only have one condition; that it is spent transparently on poverty reduction and reconstruction.
- With just one day's debt repayments Indonesia could instead afford 100 desperately needed aid flights. With a months debt repayments they could pay for three thousand flights.
- India could help provide 18 million people with emergency clean drinking water with just one day’s repayments.
Notes to Editors
In 2002 Indonesia, Thailand, Sri Lanka and India together paid US$50 billion in debt service. Of this US$7 billion went to rich country governments such as the Japan, UK and the US.
Indonesia owes Britain US$644 million dollars, 44 per cent of which was as a result of arms sales. By far the biggest creditor for Indonesia is Japan, owed US$29 billion.
Indonesia's debt payments for 2004 are 10 times more than spending on health and 33 times more than spending on housing.
A debt moratorium for two years was agreed following the devastating Hurricane Mitch in 1999 and after the floods in Mozambique in 2000, under pressure from campaigners globally. However, a moratorium will only postpone the problem, and does nothing to tackle the root cause.
For further information, please contact Matt Grainger on 44 1865 313705.