Finance Ministers of 20 of the world’s biggest economies (‘the G20’) will meet on Friday 13 November to finalise ‘a common framework for debt treatments beyond the Debt Suspension Service Initiative (DSSI)’, which suspends debts owed to bilateral creditors for 73 of the world’s poorest countries until 30 June 2021.
ActionAid and Jubilee Australia warn that if wealthy countries and international financial institutions, like the International Monetary Fund (IMF), do not urgently expand debt relief measures, developing countries will plunge deeper into poverty and gender equality could be set back by decades.
Women living in poverty and exclusion are experiencing the worst impacts of COVID-19, with an estimated one billion women in precarious and low-paid work left jobless[i].
Katherine Tu, Head of Policy and Campaigns at ActionAid Australia said: “Powerful, international financial institutions that have the means to help resolve the crisis are failing women. Research by ActionAid shows that instead of permanently cancelling debt, the IMF is pushing developing countries to adopt austerity measures as soon as COVID-19 recedes.
“Developing countries are already struggling to support people most in need during this crisis. On average, wealthy countries have spent $121 per person on health, jobs, and other social protection measures, but developing countries have only been able to spend $1 per person[iii].
“International bodies need to use this opportunity work with developing countries on solutions to resolve the debt crisis before more lives and livelihoods are lost to the pandemic,” Tu said.
Dr Luke Fletcher, Executive Director of the Jubilee Australia Research Centre said: “We cannot afford to waste any more time. People, especially women, in developing countries need a comprehensive common framework to resolve the debt crisis, which includes permanent cancellation of debt owed to private and multilateral creditors like the IMF and the World Bank, and not just bilateral creditors.
“The World Bank expects COVID-19 will push an extra 150 million people into extreme poverty, with poverty levels rising for the first time in two decades. Yet from May to December this year, developing countries are still spending up to US$26.22 billion paying off creditors[ii], instead of spending this money on healthcare and social protection for people affected by the pandemic,” Dr Fletcher said.
For more information and interviews with ActionAid spokespeople, please contact: Liz Pick, ActionAid Australia’s Media and Communications Manager on +61 (0)422 105 840 or [email protected].
Notes to editors
[i] The ILO estimates that 1.6bn informal workers face destitution by year end and another 300 million formal jobs will be lost by the end of the year. Women comprise 60 per cent of the informal sector globally so we can estimate that almost a billion low-paid women workers face destitution.
International Labour Organization, ILO Monitor: COVID-19 and the world of work, Third edition, 29 April 2020. https://www.ilo.org/wcmsp5/groups/public/@dgreports/@dcomm/documents/briefingnote/wcms_743146.pdf.
[ii] European Network on Debt and Development, The G20 Debt Service Suspension Initiative: Draining out the Titanic with a Bucket?, October 2020. https://d3n8a8pro7vhmx.cloudfront.net/eurodad/pages/768/attachments/original/1603714501/DSSIShadowReport_14Oct_%281%29.pdf?1603714501
[iii] ActionAid International, The Pandemic and the Public Sector, 13 October 2020. https://actionaid.org/publications/2020/pandemic-and-public-sector