Sudan Debt Relief 1-pager-imf World Bank

Don’t Forgive Sudan’s Debt Sudan, the IMF and World Bank: Dealing with Odious Debt BACKGROUND: SUDAN’S DEBT Despite the boom period of the last decade in Sudan’s capitol Khartoum, the country’s external debt has risen from $15 billion to $36 billion – owed mostly to multilateral, Western, Chinese, Arab and Indian creditors. Sudan’s external public debt – the second most in Africa – has increased from $13 billion in 1989 when President Omar al-Bashir engineered the coup that brought him to power. Sudan collected over $2 billion in new loans from international lenders (almost half of it from non-Paris Club bilateral loans) between 2001 and 2006 when it was still waging war in South Sudan and orchestrating its campaign of death and destruction in Darfur. In 2007 and 2008, Sudan contracted another $1.444 billion in new loans mostly from Arab multilateral and non-Paris club creditors, as well as from China and India. SUDAN’S DEBT IS ODIOUS DEBT Debt is to be considered odious if a government has used externally secured funds for personal interests or to oppress its own people. Sudan’s debt of the last twenty years has been contracted without public consent, and primarily spent to finance policies and programs against the interests of the Sudanese people. The same regime that used international loans to finance civil war and genocide in Darfur now seeks a debt-relief package to overcome its current financial challenges. WHY SUDAN’S DEBT SHOULD NOT BE FORGIVEN Instead of first changing its egregious behavior in Darfur, which would make international lenders more sympathetic to debt-relief requests, the Sudanese government continues to defy the international community by refusing to acknowledge past and ongoing human rights violations in the region, blocking humanitarian assistance and the deployment of the AU/UN peacekeeping force (UNAMID), and obstructing efforts to reach a lasting resolution to the conflict at every stage. The Sudanese government has not convincingly shown that debt-relief would actually serve the interests of its impoverished population. President Bashir and the National Congress Party (NCP) in Sudan continue to obstruct the full implementation of the North-South peace agreement and the 2005 Interim Constitution which includes a Bill of Rights. At every turn over the last five years, Bashir and the NCP have frustrated attempts to bring about true political and judicial reforms for all Sudanese. KHARTOUM’S RECENT APPEALS FOR DEBT FORGIVENESS Sudan’s Minister of Finance, Dr. Awad Ahmed Al-Jaz, led his country’s delegation to the International Monetary Fund/World Bank annual meetings in Istanbul this month – securing a plan for debt-relief was at the top of their agenda. This summer the Sudanese government officially requested help from the IMF in obtaining a debt-relief package from the international community. In July, Japan wrote off $28 million in debt while NCP officials have raised the issue with British officials on numerous occasions. David Shinn, former U.S. Ambassador to Ethiopia also recently recommended that the international community “begin the process of looking at Sudan’s debt, especially if Khartoum makes progress in ending the Darfur conflict.” IMF AND WORLD BANK OFFICIALS: DON’T FORGIVE SUDAN’S DEBT IMF and World Bank officials should clearly state that debt-relief for Sudan can only be considered if Sudan makes concrete and lasting progress toward: peace in Darfur, the full implementation of the Comprehensive Peace Agreement (CPA), and significant structural reforms that fundamentally change the repressive political and judicial systems in Sudan. If the Sudanese government demonstrably changes its behavior to the benefit of all of Sudan’s people, the international community should lead efforts to facilitate a debt-relief package for Sudan…But if the Sudanese government fails to match its recent rhetoric for peace with proven action, then the IMF and World Bank officials with world leaders must make it clear to Sudan’s leaders that any potential debt-relief package will not be considered. Media Contact: Andrea Clarke, [email protected], 202-460-6756