Cardinals and other global Christian leaders have urged the International Monetary Fund (IMF) and the World Bank to “show courageous leadership” and cancel the debts of developing countries during the coronavirus crisis.
– An appeal in the midst of “illness, death, hunger and loss of livelihoods”
140 senior Christian figures – including Cardinals Fridolin Ambongo Besungu and Berhaneyesus D. Souraphiel from Africa, Cardinal Patrick D’Rozario from Asia and Cardinal Jean-Claude Hollerich from Europe – signed a letter October 12 calling on the IMF and World Bank to help ensure the money of disadvantaged countries during the pandemic goes to where it is really needed.
“Each of us has borne witness to the impact the coronavirus pandemic has had on the most vulnerable members of our communities through illness, death, hunger and loss of livelihoods. We live and work every day with those who are suffering and share their hopes and fears for the future”, the Christian representatives wrote in their appeal to IMF managing director Kristalina Georgieva and World Bank Group President David R. Malpass.
– An “injustice” that money needed to fight COVID-19 should be used to service debt
The Church leaders reminded Georgieva and Malpass that both of their organisations have sounded the alarm about the economic and social devastation the COVID-19 tragedy will bring.
The IMF recognised that “many countries now face multiple crises – a health crisis, a financial crisis, and a collapse in commodity prices”.
The World Bank, meanwhile, warned that the pandemic “threatens to push over 100 million people into extreme poverty and is exacerbating inequality throughout the world”, and also urged governments and private creditors to suspend and reduce debts.
The Christian leaders said they are first-hand witnesses to “the ongoing injustice that the money so desperately needed for medicines, personal protective equipment, emergency food supplies and social safety nets” in developing countries “is still being diverted to debt repayments”.
Due to the gravity of that “injustice”, the Church leaders pleaded with the IMF and World Bank heads “to show courageous leadership at this critical moment” of the pandemic “and cancel debts owed by developing countries to your institutions for the duration of this crisis”.
“Debt cancellation is the most immediate way to release the finance required to prevent millions of our sisters and brothers being needlessly pushed into poverty by the pandemic”, the Christian leaders cried.
– Use reserves, gold if needed but do something to address the “urgency and magnitude” of crisis
In support of their appeal for debt relief for the developing world, the Church representatives cited Pope Francis’ petition in his message for the 2020 World Day of Prayer for the Care of Creation “for the cancellation of the debt of the most vulnerable countries, in recognition of the severe impacts of the medical, social and economic crises they face as a result of COVID-19”.
Though the Christian leaders acknowledged that the IMF and World Bank have taken steps to reduce the COVID-19 debt burden, including a six-month reprieve on payments for 28 countries and the promise of emergency finance packages worth some $88 billion, they warned even those measures fall short.
“These initiatives, though welcome, are insufficient and do not respond to the urgency and magnitude of the crisis”, the Church leaders said.
“Without the cancellation of debts, there remains a grave risk that developing countries will not have the money so desperately and urgently needed to halt the spread of the virus, to treat people suffering from the virus and to mitigate and recover from the economic and social destruction threatened by the virus”, they highlighted.
The Christian leaders closed their appeal reminding the IMF and World Bank chiefs that both of their institutions “hold significant reserves in US dollars and in gold, which are held for such a time as this”. “It is therefore essential that these reserves are used to relieve the burden of debts for countries in precarious need”, the Church leaders stressed.
“The role of the IMF and World Bank is central to tackling this crisis in a way that prioritises the needs of the most vulnerable people, learns from the past and seeks to heal and rebuild our world”, they emphasised.
The letter of the cardinals and the other global Christian leaders came as the IMF and World Bank prepare to hold their annual meetings from October 16-18.
It also arrived in the middle of the Global week of action for debt cancellation (10-17 October 2020) in which some of the world’s leading humanitarian organisations are campaigning for debt cancellation and the redress of what they are denouncing as “unsustainable and illegitimate” debt.