Urgent calls for debt relief as study shows health and education cuts in developing world

"Top economists are demanding urgent action on debt relief in Washington this week, as analysis from the campaign group Debt Justice shows struggling governments are cutting back on health and education. As finance ministers and central bankers gather for the International Monetary Fund (IMF) and World Bank annual meetings, influential experts including the Nobel laureate Joseph Stiglitz, and leading economists Mariana Mazzucato and Jayati Ghosh, are urging them to turn debt into hope."

"They are calling for the urgent replenishment of the IMF and World Bank's debt relief funds, and changes to the way the institutions work, to ensure more countries can receive debt cancellation. Bold action on debt means more children in classrooms, more nurses in hospitals, more action on climate change, more jobs, more trade, and less need for aid, they say in a letter to global policymakers."

"The signatories, who have been involved in producing important recent reports on debt relief, including for the UN secretary general and the pope, said African governments spend an average of 17% of their revenues on servicing debts. A cap of 10% in 21 countries could unlock enough money to provide clean water and sanitation to roughly 10 million people, as well as avert roughly 23,000 under-5 deaths each year, they argue."

Top economists and leading experts call for urgent debt relief and replenishment of IMF and World Bank debt relief funds while the institutions meet. They demand changes to institutional procedures to enable broader debt cancellation. Analysis from Debt Justice shows struggling governments are cutting health and education spending as debt servicing rises. African governments spend about 17% of revenues on debt servicing. Capping debt servicing at 10% in 21 countries could fund clean water and sanitation for roughly 10 million people and avert roughly 23,000 under-5 deaths annually. Signatories include Joseph Stiglitz, Mariana Mazzucato, Jayati Ghosh, Trevor Manuel, and Paulo Gentiloni.

Read at www.theguardian.com