wfn.org | LWI 2008-074 Symposium Calls for Further Political and Legal Action on Illegitimate External Debt

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Symposium Calls for Further Political and Legal Action on Illegitimate  External Debt
Lending and Borrowing Criteria Must Integrate Moral, Ethical Viewpoints

OSLO, Norway/GENEVA, 27 October 2008 (LWI)  -  Despite different opinions  and approaches with regard to a precise definition of "illegitimate  sovereign debt", representative of governments, multilateral organizations,  churches and civil society movements concluded an international symposium  on illegitimate debt with a joint agreement to push for further political  and legal action on sovereign debt crises and their impact at national and  global levels.

One of the most outstanding achievements of this gathering "was our  ability to use the communicative space it provided as an opportunity to  accept the other as a legitimate counterpart," said Rev. Atle Sommerfeldt,  Norwegian Church Aid (NCA) General Secretary, concerning the outcome  document of the International Symposium on Illegitimate Debt, co-organized  by the NCA, Church of Sweden and the Lutheran World Federation (LWF),  21-23 October in Oslo, Norway.

This symposium was not about political positions, ideologies or agendas,  remarked Sommerfeldt, referring to the variety of expertise in attendance  - more than 60 representatives of governments, church bodies, international  and regional financial institutions, United Nations agencies and civil  society organizations. "Its outcome reflects our concern for those who  suffer the real impacts of sovereign debt ... [and] are deprived of their  basic rights as global citizens," he said.

The final document summarizes the experiences that were shared at the  forum, and lists 14 generally agreed viewpoints with regard to deepening  the concept of illegitimate debt and to establishing a foundation for a  new international legal framework for debt management and resolution. The  "legitimacy" questions are generally related to the ways in which loans  are contracted, the conditions attached to such loans and their use.

The participants agreed that ongoing discussion regarding the precise  legal status and content of the concept of illegitimate debt should not  impede further political or legal action on the issue. They noted it is  nevertheless important to continue with the concept development, as  relevant criteria could be drawn from academic legal writings and state  practice, among other sources.

"Political and legal approaches to the challenges of illegitimate debt are  not mutually exclusive, but complementary approaches. Legal actions have  to be accompanied by a political strategy, and political initiatives will  invariably require legal support and follow-up," they stated.

A proposal calling for consideration of a referral to the International  Court of Justice for an advisory opinion on the legal aspects of external  debt reflects the participants' emphasis on the importance of further  official debt audits, such as the one conducted by Ecuador, and the need  to follow up concretely on the eventual prosecution of legal violation  cases.

Describing Norway's unilateral and unconditional cancellation of debt  claims against five developing countries as "a very positive step forward"  and an important example to other lenders, the participants underscored  the Norwegian practice that creditor co-responsibility was not counted as  official development assistance.

The public's responsibility is clearly spelt out in an affirmation of  civil society's indispensable role in mobilizing political will, and in  proposing and supporting legal interventions with regard to illegitimate  debt and creditor co-responsibility.

The participants identified possible follow-up actions through the UN  financing for development Doha Review Conference and the Paris Club  (representing 19 of the world's richest countries) discussions. The  suggestions also include national legislation, citizens' audits, transparen cy and accountability in budget processes and coherence of government  policy, among others.

Sovereign lending and borrowing is not just a matter of finance and  economics, but of politics, law, justice and ethics. Further efforts were  therefore urged in promoting reflection on the relationship between  foreign debt and human rights, for which guidelines could be developed in  cooperation with the UN Special Rapporteur on foreign debt and human  rights. (621 words)

The final "Outcome Document" of the International Symposium on Illegitimate  Debt is available on the LWF Web site at, http://www.lutheranworld.org/wha t_we_do/dmd/dmd-documents/Oslo_IllegitDebt_Oct08.pdf

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(The LWF is a global communion of Christian churches in the Lutheran  tradition. Founded in 1947 in Lund, Sweden, the LWF currently has 141  member churches in 79 countries all over the world, with a total membership  of over 68.3 million. The LWF acts on behalf of its member churches in  areas of common interest such as ecumenical and interfaith relations,  theology, humanitarian assistance, human rights, communication, and the  various aspects of mission and development work. Its secretariat is  located in Geneva, Switzerland.)

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