Advocacy: Debt Relief
Development needs Debt Cancellation
Unacceptable high debts make it impossible for many countries in the South to make important investments in health, education and the infrastructure. Very often the money from loans is not invested in the development of the countries, but goes into the pockets of dictators and corrupt regimes. In other cases projects are financed which do the population more harm than good. That is why the debt cancellation alliance "erlassjahr.de" calls for a more just procedure in debt cancellation. Kindernothilfe is a founding member and is active in the steering committee of the alliance.
Picture: Alexandra Höner
Erlassjahr.de is an alliance based on a wide cross-section of society. So far, the 904 member organisations include churches, dioceses, development political organisations, one-world groups, church communities and fair trade stores. Erlassjahr.de is embedded in a world-wide network of over 50 similar alliances focussing on debts. A central goal of erlassjahr.de is the implementation of fair and transparent arbitration to achieve an equilibrium of interests between creditors and debtors which both sides can live with.
The demand: The introduction of fair arbitration
The injustice of the existing procedure for treating over-indebtedness is a central issue. It is still the creditors who decide on whether to grant debt-cancellation or not and under what conditions. This practice contradicts constitutional regulations and renders a sustainable long-term debt-cancellation impossible. Debt-cancellation is necessary in many but not all countries of the South and the East to make ecologically acceptable social and economic development possible. It must be sufficiently wide-reaching in each case to prevent existing old debts to be an obstacle to an economic new start and the achievement of internationally agreed development goals. Illegitimate claims about whether they are feasible or not are not acceptable. International debtor-creditor relations must comply with constitutional standards if new loans are to stop producing new cases of indebtedness.