Keith Underhill: May 2015
Nepal: Drop the Debt
19 May 2015
As Nepal begins to deal with the aftermath of two devastating earthquakes, All We Can has joined a call for Nepal to receive immediate and unconditional debt cancellation, in order to release funds for relief and development.
The call, made by more than 30 organisations across Asia in the Asian Peoples' Movement on Debt and Development (APMDD), has also been endorsed by All We Can's local partner in Nepal, Kopila. Mrs Bina Silwal, its Executive Director, stated:
"Kopila Nepal has been actively working to relieve the suffering caused by the recent earthquake and we have seen first hand the enormous damage to infrastructure, livelihoods with the loss of human life, as well as the psychological effects on individuals and communities. The extensive losses will set back development in Nepal by more than 10 years. Kopila Nepal calls on all institutions — particularly the IMF and Asian Development Bank — to recognise that Nepal should qualify for post catastrophe relief and cancel its debts immediately."
Simeon Mitchell of All We Can commented:
"Nepal was already one of the least developed countries in the world even before this crisis. Our partners on the ground — and many other groups — are doing all they can to provide support to some of the most affected communities to meet both immediate and longer-term needs. Their efforts would be greatly assisted — and more people could be helped, more quickly — if the government of Nepal had more resources to draw on. We do not believe that debt repayments to international institutions, which are due to absorb more than 5 per cent of government revenue this year, should be a priority at this time."
All We Can's UK-based campaign partner, the Jubilee Debt Campaign, has launched an online campaign where people can write to Jim Yong Kim, President of the World Bank, and Richard Edwards, UK Director at the Asian Development Bank, asking them to cancel the debt owed by Nepal.
Jonathan Stevenson of the Jubilee Debt Campaign explains:
"The advantage of debt cancellation is that it is fast. Funds are freed up immediately for recovery and reconstruction. Debt payments will mean millions of dollars are flowing out of Nepal at the time of greatest need. Creditors, starting with the World Bank and Asian Development Bank, should take immediate steps to reverse this."
Launching the global campaign, Lidy Nacpil, coordinator of the Asian Peoples' Movement on Debt and Development (APMDD), said:
"We stand in solidarity with our colleagues and the rest of the Nepal in these critical moments. We ask governments, international financial institutions, international banks, and other lenders to do the same by immediately, totally, and unconditionally cancelling the country's debts."
One of the Least Developed Countries, Nepal ranks close to the bottom of the UN's Human Development Index, 145th out of 187 countries. Nepal's finance ministry reported that the country owes a total of almost $3.5 billion in external debts as of last October. Just above $3 billion are owed to multilateral banks such as the Asian Development Bank and the World Bank. The country is due to spend $210 million on debt repayments in 2015 alone, more than 5% of government revenue. This includes payments over 2015 of $48 million to the World Bank and $14 million to the IMF.
More than 8,000 people have died and an estimated eight million people have been affected by the first, magnitude-7.8 earthquake which hit Nepal on 25 April. A magnitude-7.3 quake followed on 12 May claiming the lives of at least 76 more. All We Can launched a major emergency appeal in the wake of the disaster.
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