January 11, 2012

Letter to Jubilee Debt Campaign UK

Filed under Public Statements

January 6, 2012

Dear Friends at Jubilee Debt Campaign UK,

I am writing on behalf of Act for Sudan, an alliance of American citizen activists and Sudanese U.S. residents, representing 59 organizations from across the United States, who advocate for an end to genocide and mass atrocities in Sudan. As you know, the situation in Sudan continues to be dire, not only in Darfur, but also for the Nuba people and throughout the South Kordofan and Blue Nile regions. The people of Sudan have suffered unimaginable violence, including genocide, under the present regime, led by Omar al-Bashir. President al-Bashir and others in his government are under indictment by the International Criminal Court for genocide and crimes against humanity.

Canceling Sudan’s debt would only benefit the ruling elite in Khartoum and give the present government even more ability to wage war on the marginalized people of Sudan. In other words, canceling Sudan’s debt at this time would only produce more injustice; it would not benefit the people of Sudan.

It would be extremely helpful if your organization would reiterate that you do not support debt relief that benefits leaders who are guilty of genocide and who continue to wage war against their own people. A strong statement from you on this point would be an important way for you to help the marginalized people of Sudan. Now is not the time to discuss the “unfairness” of Sudan’s debt, as doing so would give the Government of Sudan a propaganda victory, at the same time as the Sudan Armed Forces continue to kill civilians in Darfur, Blue Nile State, South Kordofan and other regions of Sudan. Hundreds of thousands of people have been displaced and thousands injured and killed in the closing months of 2011. Debt relief would only encourage and enable more mass killing, mass rape and genocide.

Jubilee Debt Campaign UK has been very vocal about not immediately forgiving the debt of Zimbabwe (and focusing instead on an audit of the debt) because the present regime there has such a terrible human rights record and used loan money to oppress the people of Zimbabwe.

Please raise your voices — loudly — to oppose debt relief for Sudan until Sudan is no longer under the control of genocidaires.

Thank you.

Tim Oslovich
on behalf of Act for Sudan (www.actforsudan.org)

Download the pdf version here.

Response from Jubilee Debt Campaign UK: Statement on Sudan’s debt

January 10, 2012

Sudan’s foreign debt is believed to stand at more than $35 billion. £678 million of this ($1 billion) is owed to the UK. Sudan has not been repaying debts to the western world since it defaulted on payments in 1984.

Although this is old debt, the issue of Sudan’s debt has not been high profile because of the repressive misrule of the Bashir government. However, with the independence of South Sudan, the debt issue has again come to the fore, largely because of the possibility that South Sudan could inherit some of Khartoum’s debt.

To date, north Sudan has offered to keep all the debt of the former state of Sudan. In return, both countries are requesting that north Sudan is allowed to enter the Heavily Indebted Poor Countries (HIPC) initiative within two years. If this happened, Sudan could have a substantial amount of its debt cancelled within a further two years; ie, four years in total. It is important to re-state that this process has not yet begun.

If the process fails, a negotiation will take place on how the debt should be split between the two countries. If South Sudan does receive any of this debt, we call on creditors to cancel it immediately. The people of South Sudan should not inherit any debt from Khartoum-based dictators.

To complete the Heavily Indebted Poor Countries (HIPC) initiative Sudan would have to implement conditions set down by the IMF and World Bank. These would include economic conditions. Jubilee Debt Campaign and our allies have always opposed economic conditions being put on debt cancellation, such as privatising water supplies, selling off grain reserves and cutting public spending.

Sudan would also have to start meeting repayments on some of its debts – primarily those owed to the IMF and World Bank – prior to getting any debt cancelled. Therefore, debt relief under the HIPC process would actually cost the country money.

The advantage to the Sudanese government of debt cancellation is that it might enable the regime to borrow from the IMF, World Bank and western government’s again. This should not happen whilst the current regime is in power. Jubilee Debt Campaign opposes any new lending to the current Sudanese regime, and calls for much more responsible lending by western governments and institutions to all countries.

The £678 million debt owed to the UK comes from loans to dictator Gaafar Nimeiry during the Cold War. The vast majority of the debt is interest, due to the extortionate 10-12 per cent interest rates charged on it since 1984. Any debt cancellation by western governments such as the UK is an accounting exercise, writing off debts that any private company would have written off many years ago. Whilst we are not calling for debt cancellation for Sudan happening at this time, by itself debt cancellation would not bring material benefit to the Sudanese regime.

None of Sudan’s illegitimate debt must be held against a future legitimate government of Sudan. Rather than undergoing the HIPC process, a future Sudanese government should implement a debt audit process, to find out where the debt comes from, how legitimate it is, and learn lessons to guide future responsible borrowing. A debt audit would increase economic democracy within the country. Lenders must make clear that they would support the auditing of Sudan’s debt and the cancellation of illegitimate debt upon the accession to power of a legitimate government in Sudan. Moreover, when this made-up debt is finally written off, none of it should be counted as ‘aid’, as currently planned by the UK and other western governments.

Jubilee Debt Campaign are currently supporting campaigns for debt audits in countries such as Zimbabwe, and are willing to work with civil society groups in Sudan wanting to push for an official audit and/or implement a citizens audit. However, we recognise that under the current circumstances, this may be challenging for Sudanese activists.