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Letter to Congress on Multilateral Debt Relief Act

 

July 18, 2005

Dear Senator,

As Chairman of the International Policy Committee of the United States Conference of Catholic Bishops (USCCB), I urge you to support S. 1320, the Multilateral Debt Relief Act of 2005. USCCB’s support for this new step towards deeper debt cancellation reflects our religious and moral principles that commit us to “the least of these” (Matthew 25). Catholic Relief Services (CRS), the aid and development agency of the U.S. Catholic Bishops, knows first hand the needs of the people living with the burden of crushing debts from its work among the poorest people of the earth in over 80 countries. S. 1320, with its bipartisan support, represents an essential next step in meeting the needs of many poor people, especially in Africa.

The USCCB has long worked for the debt cancellation measures that were announced by G8 Finance Ministers in June 2005 and confirmed by G8 leaders at their recent meeting in Gleneagles, Scotland. S. 1320 provides Congressional support for this agreement and authorizes the appropriation of the funds necessary to finance the U.S. share of its costs. Our understanding is that in FY06 through FY08 full funding of the amounts committed by the United States in the most recent replenishment agreements for the World Bank’s International Development Association (IDA 14) and the African Development Fund (ADF 10) will be sufficient to meet the U.S. share of the costs of implementing the new G8 agreement. (For FY 06 this will require the appropriation for IDA of the full $950 million requested by the President.) Any shortfall in the appropriation of the amounts committed for IDA 14 and ADF 10 will undermine the new agreement.

This legislation is important for two other reasons. First, it authorizes cancellation of debt owed to the Inter-American Development Bank (IDB). The IDB is the largest creditor of Latin American and Caribbean (LAC) countries eligible for G8 debt cancellation. Unless the G8 agreement is extended to include IDB debt, LAC countries will have a much smaller share of their debt cancelled than African countries. Second, S. 1320 contains a Sense of Congress provision that asks the U.S. Treasury to work towards debt relief for countries entitled to grant financing from IDA but are not eligible for debt cancellation under the G8 agreement. These countries are suffering debt distress as great as, or greater than, countries covered by the G8 agreement, but because they are not included in the on-going Heavily-Indebted Poor Countries (HIPC) debt relief initiative, they are not eligible for debt cancellation. Fairness requires that these countries be made eligible for debt relief on the same basis as the HIPC countries without undue delay.

The merits of deeper debt cancellation, when accompanied by conditions of accountability and transparency on the part of recipient countries, have been shown to generate much needed resources for health, education and poverty reduction for some of the world’s poorest people. Congressional support for implementation of the G8 debt cancellation agreement will reinforce the new global partnership launched at the G8 summit, offering the hope that countries can cooperate in eliminating the conditions that lead to suffering and despair and in some cases allow terrorism to fester. The U.S. must play a key role in this effort by acting on the generosity and compassion that have been consistent hallmarks of the people of the United States.

I believe that S. 1320, the Multilateral Debt Relief Act, marks a major contribution in the fight to overcome global poverty and disease. I hope you will agree to co-sponsor this important legislation. Thanking you for your consideration, I remain,

Sincerely yours,

Most Rev. John H. Ricard, SSJ
Bishop of Pensacola-Tallahassee
Chairman, Committee on International Policy


July 18, 2005

Dear Representative,

As Chairman of the International Policy Committee of the United States Conference of Catholic Bishops (USCCB), I urge you to support H.R. 3191, the Multilateral Debt Relief Act of 2005. USCCB’s support for this new step towards deeper debt cancellation reflects our religious and moral principles that commit us to “the least of these” (Matthew 25). Catholic Relief Services (CRS), the aid and development agency of the U.S. Catholic Bishops, knows first hand the needs of the people living with the burden of crushing debts from its work among the poorest people of the earth in over 80 countries. H.R. 3191, with its bipartisan support, represents an essential next step in meeting the needs of many poor people, especially in Africa.

The USCCB has long worked for the debt cancellation measures that were announced by G8 Finance Ministers in June 2005 and confirmed by G8 leaders at their recent meeting in Gleneagles, Scotland. H.R. 3191 provides Congressional support for this agreement and authorizes the appropriation of the funds necessary to finance the U.S. share of its costs. Our understanding is that in FY06 through FY08 full funding of the amounts committed by the United States in the most recent replenishment agreements for the World Bank’s International Development Association (IDA 14) and the African Development Fund (ADF 10) will be sufficient to meet the U.S. share of the costs of implementing the new G8 agreement. (For FY 06 this will require the appropriation for IDA of the full $950 million requested by the President.) Any shortfall in the appropriation of the amounts committed for IDA 14 and ADF 10 will undermine the new agreement.

This legislation is important for two other reasons. First, it authorizes cancellation of debt owed to the Inter-American Development Bank (IDB). The IDB is the largest creditor of Latin American and Caribbean (LAC) countries eligible for G8 debt cancellation. Unless the G8 agreement is extended to include IDB debt, LAC countries will have a much smaller share of their debt cancelled than African countries. Second, H.R. 3191 contains a Sense of Congress provision that asks the U.S. Treasury to work towards debt relief for countries entitled to grant financing from IDA but are not eligible for debt cancellation under the G8 agreement. These countries are suffering debt distress as great as, or greater than, countries covered by the G8 agreement, but because they are not included in the on-going Heavily-Indebted Poor Countries (HIPC) debt relief initiative, they are not eligible for debt cancellation. Fairness requires that these countries be made eligible for debt relief on the same basis as the HIPC countries without undue delay.

The merits of deeper debt cancellation, when accompanied by conditions of accountability and transparency on the part of recipient countries, have been shown to generate much needed resources for health, education and poverty reduction for some of the world’s poorest people. Congressional support for implementation of the G8 debt cancellation agreement will reinforce the new global partnership launched at the G8 summit, offering the hope that countries can cooperate in eliminating the conditions that lead to suffering and despair and in some cases allow terrorism to fester. The U.S. must play a key role in this effort by acting on the generosity and compassion that have been consistent hallmarks of the people of the United States.

I believe that H.R. 3191, the Multilateral Debt Relief Act, marks a major contribution in the fight to overcome global poverty and disease. I hope you will agree to co-sponsor this important legislation. Thanking you for your consideration, I remain,

Sincerely yours,

Most Rev. John H. Ricard, SSJ
Bishop of Pensacola-Tallahassee
Chairman, Committee on International Policy

 



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