The external debt

The external debt

By Gustavo Castro Soto

The external debt situation has become unsustainable. For this reason, in the past two decades, the number of peasants living in extreme poverty has increased from 39.9 to 46.4 million people.

The external debt situation has become unsustainable. According to the World Bank (WB) and the International Monetary Fund (IMF), by 2000, 49% of the Gross Domestic Product (GDP) of Belize corresponded to the amount of indebtedness; 29.9% in El Salvador; 22.6% in Guatemala; 99.4% in Honduras; 281% in Nicaragua; 76.6% in Panama and 34% in Mexico. These numbers have been increasing in the last five years. However, Latin America has already paid US $ 1.4 trillion in the last 20 years. All the so-called "Third World" together with the Eastern European countries gave the International Financial Institutions (IFI's) more than US $ 4 trillion in the same period, which is equivalent to more than six times the original debt, despite the fact that today they owe equal an average of four times more. For this reason, in Latin America, in the past two decades the number of peasants living in extreme poverty has increased from 39.9 to 46.4 million people. At the same time, Bill Gates, Paul Allen, Warren Buffet and Larry Ellisson, together have a fortune greater than that of the GDP of 42 nations with 600 million inhabitants. At Real Madrid, the Spanish soccer team, three players - a Brazilian, an Englishman and a Frenchman - receive, together, annual salaries of 42 million dollars, equivalent to the annual budget of the capital of El Salvador, with about 1.8 millions of inhabitants.

In recent years, the World Bank has provided grants and loans to developing countries for a total that fluctuates between 18 and US $ 20 billion a year. According to ECLAC, between 2002 and 2004 the net transfer of resources made by the Latin American countries reached 153 thousand 191 million dollars. This amount exceeded by 45.15% the 105 thousand 535 million dollars that it received through foreign direct investment. Thus, governments are allocating between 40 and 65% of their budgets to pay the service of a debt that has already been paid many times. As if that were not enough, the amount of money that migrants from the north send in remittances to the global south is greater than this amount.

This situation is what has led the social movement of the global south to protest against the International Financial Institutions (IFIs). For this reason, between September 28 and October 2, four important meetings were held in the city of Havana, Cuba: the II Global Assembly of South Jubilee; the South North Meeting of Resistance and Alternatives to the Domination of Debt; II Meeting of the Campaign “Yes to Life, No to the IFI’s; and Meeting of the International Committee of the Campaign against the World Bank Bonds. Due to their importance and significance, we reproduce the texts of the South Jubilee Declarations.

South Jubilee Declaration
II Global Assembly
Havana, Cuba September 28, 2005

With the presence of representatives from 39 countries, JUBILEE SOUTH celebrated its 2nd. South-South Summit and Tricontinental Assembly in Havana City, Cuba from September 25 to 28, 2005.

We recall on this occasion the historic meetings that took place in 1985 in Havana, which contributed to the creation of a greater level of global awareness about the true nature of the debt problem and at the same time strengthened the resistance struggle against it. payment of an enslaving debt. President Fidel Castro echoed what various participants had already raised when declaring that the debt of the countries of the South had already been paid many more times and that it had no moral, political or legal basis, and that in any case , should not be paid.

Twenty years later, Jubileo Sur is here to affirm that we, the peoples of the South, are the true creditors of a massive ecological, moral, social, financial and historical debt that has accumulated over the last centuries during the long history of colonization. which continues to accumulate today as a consequence of the continuous looting and exploitation of our resources, our peoples, our work and our economies. In particular, we denounce the current wars against those peoples who are fighting for their national liberation and against the occupation. The payment of the debt entails a systematic violation of human rights, as in many cases it entails imprisonment, deaths, disappearances and exile. We insist on the total nullification of the debt for immoral and unjust that undermines popular sovereignty and the right to determine our own future.

6 years have passed since the founding of our Assembly. During the celebration of the 2nd. Assembly in Havana we have been able to verify the considerable growth and consolidation of our unique South-based network and our Movement for the elimination of debt domination and to ensure the recognition and restitution of the historical, social, financial and ecological debt that the North has contracted with the South. We have gathered here to enrich these achievements, evaluate new possibilities and prepare our plans of action.

Since our last Assembly, we have witnessed a dramatic escalation of neoliberal terrorism taking the form of imperialist aggressions, including the invasion and occupation of sovereign nations, as well as a growth in militarization in many parts of the world. At the same time however, there has also been a growth in the number and scale of movements opposing the war and the spread of globalized corporate neoliberalism. Jubilee South is proud to be part of the global resistance and to play a strategic role within the Movement and the Constitution of the formation process of the World Social Forum. We want to note that this issue of debt is of great significance within the agenda of movements worldwide, and that it is increasingly recognized as a human rights issue, linked to the "free trade" process and the militarization that it is a component of the same neoliberal practices.

The forces of the movement and their demands have forced the so-called creditors to engage with this debt issue - in an inappropriate way -. An example of the above is the recent proposal by the G8 governments - countries that have become richer on the basis of fraudulent debt mechanisms - which offer to cancel a miniscule amount of debt collaterally demanded by a handful of countries along with the arrangements that do not mean more than the maintenance of the same system of domination. These initiatives are a clear manifestation of the depth of the current crisis as well as the deceptive nature of the multiple schemes of the so-called debt relief, its reduction and its exchanges offered by creditors. We warn that these same initiatives entail the danger of co-optation by formal advocacy bodies and by our governments who refuse to recognize and reveal the hypocrisy of the G8 and its instruments such as the International Monetary Fund, misnamed international. Initiatives such as HIPC, swaps, sovereign debt must be denounced as mechanisms of deception and deepening that perpetuate new mechanisms to maintain external and internal debt.

Jubilee South affirms that the role and mandate adopted by our assembly is to work for and to demand the unconditional rejection and cancellation of the external debts of all countries of the South.

At the same time we demand the recognition and restitution of the moral, social, financial and ecological debt that the North has contracted with the South.

We commit ourselves to expand and deepen our movement, to challenge and overcome our weaknesses, to ensure the active presence of JS in the campaigns and movements against imperialist globalization in all its forms and manifestations, including wars against sovereign nations, privatization , military bases and the destruction of the environment. We will also denounce the participation of the Governments of the South in perpetuating the debt problems that also put at risk the assets of our peoples that seek to be privatized by the governments. We pledge to redouble our efforts in favor of changing the policies of the governments of the South, which should be aimed at repudiating external debts. We see in carrying out debt audits a fundamental step for the achievement of our objectives.

We will grow on the achievements already made in previous years, we will strengthen Jubileo Sur as a movement that gives strength and voice to the oppressed and exploited peoples of the world who defend their cultures, also threatened by debt and capitalist exploitation. As we call on the peoples of the North to continue supporting the demand for an end to debt domination, we will remain rooted within regional and national movements within people's organizations by developing our established capacities. in the South in favor of analysis, in obtaining consensus and articulating our positions on debt and other related issues. We will be part of the efforts to develop and articulate the alternatives of the peoples against the neoliberal global order and war

Within this context, Jubileo Sur is committed to supporting the sovereignty of the Cuban people and the end of the cruel and illegal embargo directed by the United States government.

We enrich our energies by holding this assembly in Havana, Cuba - which is a symbol and inspiration for all of us who fight against the oppressive neoliberal order. In expressing our solidarity with Cuba, we also express our gratitude for their generous collaboration with our meeting and our cause, faithful to the spirit and presence of Ernesto Che Guevara, a living example in our tri-continental struggle and in our alliance against imperialism.



1. Five years after the first meeting, in Dakar, Senegal, representatives of social movements and campaigns against the debt of 51 countries, we met in Havana, Cuba, from September 28 to 30, 2005, for the II South-North Meeting "Resistance and Alternatives to the Domination of Debt". We commemorate the 20th anniversary of the historic meetings that took place in Havana that focused the world's attention on the true nature of the debt crisis and strengthened the resistance to paying an enslaving debt.

2. The movements, organizations and campaigns gathered here, coming from the South and the North, agree to promote the international recognition of the peoples and countries of the South as creditors of the social, ecological, cultural and financial debts of the North. We call on the governments of the North to recognize these debts, accumulated on the basis of their policies of looting in violation of all human rights, including the right to sovereignty and self-determination.

3. The strength of the fight against debt domination is based on the unceasing efforts of debt campaigns and social movements around the world. We affirm our commitment to work together, in solidarity through campaigns and initiatives in both the South and the North, strengthening our movements to reverse the enormous historical injustice that has led us to meet here.

4. In 2005, we acknowledge that the accelerated processes of globalization have only extended and exacerbated the debt crisis, one of the worst scourges to afflict humanity. Far from diminishing, the burden of external debt claimed from the countries of the South remains a major obstacle limiting their development, forcing them to pay interest to enriched countries and institutions instead of investing in the rights and priorities of their peoples. Initiatives by those same countries and institutions, such as the HIPC Initiative (HIPC), have not resolved this grotesque situation. On the contrary, their policies and actions have increased indebtedness and inequality everywhere.

5. Debt is used as an instrument of control over the exploited and impoverished countries. The domination of debt must end urgently. The injustice and poverty caused by debt must end and its consequences repaired. The plundering of natural resources and the exploitation of peoples, mechanisms imposed to guarantee the payment of the foreign debt, must end. The use of debt to impose policies such as neoliberalism on the countries of the South must end. Unfair trade must stop, including the so-called free trade agreements that cause growing indebtedness and loss of control over natural wealth and national sovereignty. Relations between countries must be based on justice and respect for human rights and not on oppression, militarization and war. All the illegitimate, unjust and unpayable debt of the South must be canceled immediately. This cancellation must not be linked to conditionalities imposed from abroad. We encourage the repudiation of the debt and we will be in solidarity with the governments that decide to take this path.

6. Governments, transnationals and enriched institutions such as the IMF, WB and WTO must accept responsibility for the looting of the countries of the South, for creating and perpetuating the debt crisis and especially for the odious debt. Given the historical and current exploitation of the countries of the South, the unjust financial, economic and political relations between those who are exploited and those who exploit, and the ecological devastation imposed on the South through the governments and commercial interests of the North, it is unquestionable that the North owes the South.

8. The South-North Meeting "Resistance and Alternatives to the Domination of Debt" expresses its gratitude to Cuba for the generous collaboration for the realization of our Meeting. At the same time, he calls on the government of the United States to recognize the debt incurred against the Cuban nation, caused by the illegal and immoral blockade as well as by other acts of aggression by the United States government.

9. While we reaffirm our conviction about the urgency of overcoming the domination of debt, we recognize that debt alone is not enough. It is essential to simultaneously promote the design of comprehensive economic and social policies that promote respect and development of our peoples and nations and the construction of these alternatives.

Immediate cancellation of illegitimate and odious debt
We do not owe, we do not pay [2]

So far the texts.

According to data from the World Bank, the average per capita income at the global level in 1976 was 150 dollars the lowest level and 6,200 dollars the highest. After 30 years of neoliberal policies, the lowest average only grew almost twice as much, reaching 420, while at the highest level it was almost five times more, reaching 27,510 dollars per head. For its part, the debt of the global south stood at 100 billion dollars in 1970 and reached 2.7 trillion dollars. This can no longer be borne. Enough! Another World is Possible!

* Gustavo Castro Soto

[1] Declaration of Havana of the II South-North Consultation on "Resistence and Alternatives to Debt Domination¨- English text available at ; - Declaration of the Havane de la II Rencontre Sud-Nord sur "Résistance et Alternatives á la Domination de la Dette" - text in French available at

[2] Jubileo South / Americas Secretariat; Piedras 730 (1070) Bs.As., Argentina; Telefax + 5411-43071867; [email protected] ;

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