The concluding declaration from last week's G20 summit indicates that the richest countries in the world are not facing up to the causes of the global debt crisis and its impact on the poorest, says a leading NGO working on debt issues.
Tim Jones, policy officer at Jubilee Debt Campaign in the UK, said: “The G20 have their head in the sand about the global debt crisis. Today’s high debts come from the reckless lending of banks. Cancelling these unjust debts, rather than further austerity, is the way out of the crisis.”
“To prevent debt crises happening again, lenders need to be more responsible, and finance needs to be controlled. Yet the G20 want to put sustainable lending standards in the hands of the IMF and World Bank, who themselves are responsible for half the lending to low income countries, where debt burdens are increasing rapidly. This is a conflict of interest which is sowing the seeds of the next crisis," he added.
Half the lending to low income countries is from the IMF and World Bank according to calculations by the Jubilee Debt Campaign based on the World Bank's world development indicators official database.
The G20 declaration says that the main challenges to the global economy include “High public debt and its sustainability in some countries that need to be addressed while properly supporting the recovery in the near-term, especially in countries with the highest actual and projected debt to GDP levels.”
In a section on debt management practises, the G20 declaration says: "We also support the implementation of the IMF-World Bank Debt Sustainability Framework for Low-Income Countries and will take the Framework into consideration in order to better inform our practices and promote sustainable financing and sustainable growth and development through appropriate channels."
Jubilee Debt Campaign is part of a global movement demanding freedom from the slavery of unjust debts and a new financial system that puts people first.
The advocacy organisation, supported by Ekklesia and many others, explains: "Inspired by the ancient [biblical] concept of ‘jubilee’, we campaign for a world where debt is no longer used as a form of power by which the rich exploit the poor. Freedom from debt slavery is a necessary step towards a world in which our common resources are used to realise equality, justice and human dignity."