From the Worldwide Faith News archives

Foreign Debt Is an Ethical Issue, Not Merely Economic or Social

From "Frank Imhoff" <>
Date Thu, 30 Jan 2003 09:29:47 -0600

LWF Sponsors Workshop on Illegitimate Debt at World Social Forum

PORTO ALEGRE, Brazil/GENEVA, 29 January 2003 (LWI) - "The foreign
debt of developing countries is an ethical issue, not merely an
economic and social one," said former president of the Evangelical
Church of the River Plate, Argentina, Rev. Juan Pedro Schaad. He
was speaking at the World Social Forum held in Porto Alegre,
Brazil, 23-28 January.

At a workshop on "Illegitimate Debt: An Ethical Approach to Debt
Issues" sponsored by the Lutheran World Federation (LWF) in
cooperation with the Latin American LWF member churches, Schaad
requested that such foreign debt be subject to external audit. "If
debt was once a threat to people's quality of life, their culture,
their jobs, the future of their children, today it is a matter of
life and death," he said. "Those who study this subject
demonstrate that we have already paid the debt many times over."
But he said he believes in reaching consensus, counseling against
both the payment of the debt and the radical path of non-payment.
The central task of the worldwide network of churches is to seek
consensus in assessing the illegitimacy of foreign debt.

Speaking on the Argentinean crisis, Schaad described as
"absolutely immoral" the flight of around USD 40 billion from the
country in the period between November 2001 to January 2002. He
said this calls for profound analysis, so that the level of
impunity of the global financial system can be better understood.
"Foreign debt, corruption and impunity go hand in hand. They are
inseparable, they love each other, they need each other, they
serve the same master." The December 2001 decision of the
Argentinean government to block Argentinean bank accounts led to
strong protests and street fighting as well as the stepping down
of President Fernando de la Rua.

At the same time, situations such as that in Argentina bring back
older values such as solidarity with its strong biblical
connotations. "The Gospel, through Jesus of Nazareth, consistently
demonstrates what kind of world and what kind of society God wants
to rebuild," Schaad said at the workshop, which was chaired by Mr
Peter Prove, LWF Assistant to the General Secretary for
International Affairs and Human Rights.

Mr Joseph Hanlon, consultant for Norwegian Church Aid (NCA) told
participants in the workshop that over the past five years,
developing countries have made foreign debt repayments amounting
to a total of USD 2.5 trillion. Author of the NCA publication
"Defining Illegitimate Debt and Linking its Cancellation to
Economic Justice," Hanlon also has worked as adviser to the
international Jubilee 2000 movement.

Hanlon said he considers loans to be illegitimate if they are
illegal, unjust, improper or contrary to public policy.
International movements such as Jubilee 2000 must amplify the
question of illegitimacy of foreign debt in order to make
themselves better understood by society at large, he said. "They
must show the causes and demonstrate, with clear, solid arguments,
that such debt is illegitimate."

The reason for the LWF delegation to participate in the World
Social Forum, according to Rev. Angel Furlan from Argentina, was
to seek an answer to the growing unrest in the regions. The theme
of foreign debt, globalization and human rights needs more
attention, he said. Furlan, president of the United Evangelical
Lutheran Church, Argentina, and moderator of the Bishops and
Presidents Conference of the LWF Latin American member churches,
led the LWF delegation which included representatives of member
churches in Argentina, Chile, Costa Rica and India, as well as
some LWF staff.

(Reported by Susanne Buchweitz, Brazil)

(The LWF is a global communion of Christian churches in the
Lutheran tradition. Founded in 1947 in Lund (Sweden), the LWF now
has 136 member churches in 76 countries representing over 61.7
million of the 65.4 million Lutherans worldwide. The LWF acts on
behalf of its member churches in areas of common interest such as
ecumenical relations, theology, humanitarian assistance, human
rights, communication, and the various aspects of mission and
development work. Its secretariat is located in Geneva,

[Lutheran World Information (LWI) is LWF's information
service.Unless specifically noted, material presented does not
represent positions or opinions of the LWF or of its various
units. Where the dateline of an article contains the notation
(LWI), the material may be freely reproduced with acknowledgment.]

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