PRAGUE -- International debt relief campaigners took to the streets of Prague on Sunday angrily demanding that the world's creditors finally make good on promises to write off large swathes of poor countries' debts.
Over a thousand people marched through the historic streets of Prague in a demonstration organized by the campaign group Jubilee 2000, which has been highly effective in forcing the issue of debt relief right up the international agenda.
They staged a mock funeral march in protest at the 19,000 children they say die every day in the world's poor countries because those countries spend far more money servicing debts to ich countries than they do on basic health care.
The International Monetary Fund and World Bank are holding their annual meetings here this week. Finance ministers and central bank governors of the Group of Seven (G7) leading industrial countries met on Saturday.
"Here in Prague, the finance ministers and the World Bank and IMF have once again claimed they are solving the debt crisis. But the initiative they have created will do no such thing," said Ann Pettifor, Jubilee 2000's director.
WE WILL NOT BE MOVED, SAY CAMPAIGNERS
"We will not settle for the half measures they seem so proud of. We want them to know that we will not go away until they have cancelled 100 percent of the debts of the poorest countries."
She was referring to the Heavily Indebted Poor Countries (HIPC), launched by the IMF and World Bank in 1996 with the aim of ridding 41 of the world's poorest countries - mostly in Africa - of the bulk of their debt. But the initiative has stalled, caught in a tangle of over-complex conditions required of countries who wanted debt relief and an unwillingness by many rich countries to stump up the cash for the scheme.
HIPC was overhauled at a Group of Seven (G7) meeting in Cologne last year but there has still been little progress. Only 10 countries have so far entered the process but are still unlikely to see any serious debt reduction for some years.
Only one country - Uganda - has completed the process but it's finance minister Gerald Ssendaula told Reuters last week many creditor countries had still failed to honor their side of the agreement to cancel debt.
Many other HIPC hopefuls were also at the IMF meetings in Prague to protest about the lack of real action on the issue.
The G7 has pledged to get 20 countries into the process by the end of the year but Jubilee 2000 says they still have to jump through too many hoops to get a big cut in their debts.
CANADA SUGGESTS MORATORIUM
Canadian Finance Minister Paul Martin urged creditor countries to freeze poor country debt repayments as a way of speding up HIPC.
"Why should we not consider an immediate moratorium on debt payments from the eligible HIPC reforming countries?" he told a meeting of the IMF's International Monetary and Financial Committee (IMFC).
Campaigners were initially excited until it became clear Martin was only referring to the 10 countries which have already qualified for HIPC and only to bilateral debt payments, which are in any case supposed to cease at decision point.
Britain's Chancellor of the Exchequer Gordon Brown made the same point to a press conference.
The IMFC meeting backed a recent IMF/World Bank statement in which the two bodies promised to try to be more flexible with the HIPC conditionality as a way of speeding the process up.
"What we have done, because we recognise the need for speedy implementation, without removing the conditionality, is decide on measures that can get more countries through...we believe we can get 20 countries through by the end of the year," Brown told Reuters after the meeting.
But that was not good enough for Jubilee 2000.
"We are angry and deeply disappointed... the credibility of this initiative has evaporated. Finance ministers seem incapable of understanding that the poorest countries are effectively insolvent and need a 100 percent cut in debt service, not the one third that is on offer," said Pettifor.
Bono, lead singer of rock group U2 and a key supporter of Jubilee 2000, was set to meet new IMF chief Horst Koehler on Monday to put the case for debt relief. Koehler has pledged to speed up HIPC and then go beyond it.
- 194 World Financial Institutions