A month after Typhoon Haiyan, Jubilee Debt Campaign (UK) and Christian Aid have joined with the Freedom from Debt Coalition (the Philippines) and Jubilee South (Asia Pacific Movement on Debt and Development) to call the debt of the Philippines to be cancelled.
Over $20 million a day - $8 billion a year – leaves the Philippines as debt payments to international lenders. Since Typhoon Haiyan struck on 8 November 201, over $550 million (£335 million) has been spent on debt payments.
Due to interest payments over the last 40 years, the Philippines has been lent $115 billion, repaid $132 billion, but is still said to owe $60 billion.
The Philippines' large debt originated with the regime of the dictator Ferdinand Marcos, when western governments and institutions, such as the World Bank, supported the leader with loans to keep him on side during the Cold War.
Loans included to build a nuclear power plant which never generated any electricity, and was built on an earthquake fault line. After decades of paying high debts, the Philippines government still spends over 20 per cent of its revenue on foreign debt payments.
Since Typhoon Haiyan hit the archipelago, the World Bank and Asian Development Bank have both announced loans totalling $1 billion, to ‘help’ with rebuilding following the devastation, but this will just further increase the Philippines debt. Estimates have started to put the costs of rebuilding following the typhoon at between $6.5 billion and $15 billion.
Sarah-Jayne Clifton, Director of Jubilee Debt Campaign, commented: “The Philippines urgently needs funding for relief and reconstruction efforts, as well as to adapt to the unavoidable impacts of climate change and support communities who live in areas that are beyond adaptation. International lenders should put life before debt and cancel the Philippines foreign debt obligations as a matter of urgency.”
Joseph Stead, Senior Economic Justice Adviser at Christian Aid added: “Debts that should have been cancelled years ago are limiting the capacity of the Philippines to respond and rebuild to the typhoon. Action on this is clearly needed before any new debts are added.”
“Justice for the Filipino people demands debt cancellation, especially the illegitimate debts, which are odious, onerous, illegal, violate human rights, harmful to the people, environment and climate, and bereft of institutional processes and the consent of the people. Climate justice demands reparations to enable the Philippines to develop resilience to climate change and compensation for losses and damages,” said Ricardo Reyes, Freedom from Debt Coalition president.
Freedom from Debt Coalition, Jubilee South (Asia), Christian Aid and Jubilee Debt Campaign have launched a petition calling on lenders such as the World Bank and Asian Development Bank to cancel Philippines debt.
Following the global jubilee movement calling for debt cancellation or repudiation of developing country debts, $130 billion of debt has been cancelled, mainly for African countries. The Philippines was excluded from the scheme because it was judged by the IMF and World Bank to be ‘too rich’.
However, over 15 million people in the Philippines are malnourished and similar numbers live in extreme poverty. The numbers have changed little since Ferdinand Marcos was removed from power in 1986.
Ekklesia is a supporter of the Jubilee Debt Campaign, and works in partnership with Christian Aid.
* The petition can be signed at:
* A running total of payments since Typhoon Haiyan is available on the same website.