By Danny Bradlow, Kevin P. Gallagher and Marina Zucker-Marques
PRETORIA. South Africa / CAMBRIDGE, USA, Sep 27 2024 – The statistics are stark: 54 governments, of which 25 are African, are spending at least 10% of their revenues on servicing their debts; 48 countries, home to 3.3 billion people, are spending more on debt service than on health or education.

Among them, 23 African countries are spending more on debt service than on health or education. While the international community stands by, these countries are servicing their debts and defaulting on their development goals.

The Group of 20’s current approach for dealing with the debts of low income countries is the Common Framework.

It requires the debtor to first discuss its problems with the International Monetary Fund (IMF) and obtain its assessment of how much debt relief it needs. Then it must negotiate with its official creditors – international organisations, governments and government agencies – over how much debt relief they will provide. Only then can the debtor reach an agreement – on comparable terms to the official creditors – with its commercial creditors.

Unfortunately, this process has been sub-optimal.

One reason is that it works too slowly to meet the urgent needs of distressed borrowers. As a result, it condemns debtor countries to financial limbo. The resulting uncertainty is not in anyone’s interest.

For example, Zambia has been working through the G20’s cumbersome process for more than three and a half years and has not yet finalised agreements with all its creditors.

The need for a new approach is overwhelmingly evident. Although the current crisis has not yet become the “systemic” threat it was in the 1980s when multiple countries defaulted on their debt, it is a “silent” sovereign debt crisis.

We propose a two-part approach that would improve the situation of sovereign debtors and their creditors. This proposal is based on the lessons we have learned from our work on the legal and economic aspects of developing country debt, particularly African debt.

First, we suggest that official creditors and the IMF create a strategic buyer of “last resort” that can purchase the bonds of debt distressed countries and refinance them on better terms.

Second, we recommend that all parties involved in sovereign debt restructurings adopt a set of principles that they can use to guide the debtor and its creditors in reaching an optimal agreement and monitoring its implementation.

The current approach fails to deal effectively and fairly with both the concerns of the creditors and all the debtor’s legal obligations and responsibilities. Our proposed solution would offer debtors debt relief that does not undermine their ability to meet their other legal obligations and responsibilities, while also accommodating private creditors’ preference for cash payments.

Our proposal is not risk-free. And buybacks are not appropriate for all debtors. Nevertheless, it offers a principled and feasible approach to dealing with a silent debt crisis that threatens to undermine international efforts to address global challenges such as climate, poverty and inequality.

It uses the IMF’s existing resources to meet both the bondholders’ preferences for immediate cash and the developing countries’ need to reduce their debt burdens in a transparent and principled way.

It also helps the international community avoid a widespread default on debt and development.

Bondholders are a major problem

Foreign bondholders, who are the major creditors of many developing countries, have proven to be particularly challenging in providing substantive debt relief in a timely manner. In theory, they should be more flexible than official creditors.

Developing countries have been paying bondholders a premium to compensate them for providing financing to borrowers that are perceived to be risky. As a result, bondholders have already received larger payouts than official creditors. Therefore, they should be better placed than official creditors to assist the debtor in the restructuring processes.

However, despite having received large returns from defaulted bonds, bondholders have remained obstinate in debt restructurings. Our proposal seeks to overcome this hurdle in a way that is fair to debtors, creditors and their respective stakeholders.

How it would work

First, the official creditors and the IMF should create and fund a strategic buyer “of last resort” who can purchase distressed (and expensive) debt at a discount from bondholders. The buyer, now the creditor of the country in distress, can repackage the debt and sell it to the debtor country on more manageable terms.

The net result is that the bondholders receive cash for their bonds, while the debtor country benefits from substantial debt relief. In addition, the debtor and its remaining official creditors benefit from a simplified debt restructuring process.

This concept has precedent. In 1989, as part of the Highly Indebted Poor Countries Initiative, the international community’s effort to deal with the then existing debt burdens of poor countries, the World Bank Group established the Debt Reduction Facility, which helped eligible governments repurchase their external commercial debts at deep discounts. It completed 25 transactions which helped erase approximately US$10.3 billion in debt principal and over US$3.5 billion in interest arrears.

Some individual countries have also bought back their own debt. In 2009, Ecuador repurchased 93% of its defaulted debt at a deep discount. This enabled the government to reduce its debt stock by 27% and promote economic growth in subsequent years.

Unfortunately, the countries currently in debt distress lack sufficient foreign reserves to pursue such a strategy. Hence, they need to find a “friendly” buyer of last resort.

The IMF is well positioned to play this role. It has the mandate to support countries during financial crises. It also has the resources to fund such a facility. It can use a mix of its own resources, including its gold reserves, and donor funding, such as a portion of the US$100 billion in Special Drawing Rights (SDR), the IMF’s own reserve currency, which rich economies committed to reallocate for development purposes.

Such a facility, for example, would have enabled Kenya to refinance its debts at the SDR interest rate, currently at 3.75% per year, rather than at the 10.375% rate it paid in the financial markets.

It is noteworthy that the 47 low-income countries identified as in need of debt relief have just US$60 billion in outstanding debts owed to bondholders. Our proposed buyer of last resort would help reduce the burden of these countries to manageable levels.

Second, we propose that both debtors and creditors should commit to the following set of shared principles, based on internationally accepted norms and standards for debt restructurings.

Guiding principles

1. Guiding norms: Sovereign debt restructurings should be guided by six norms: credibility, responsibility, good faith, optimality, inclusiveness and effectiveness.

Optimality means that the negotiating parties should aim to achieve an outcome that, considering the circumstances in which the parties are negotiating and their respective rights, obligations and responsibilities, offers each of them the best possible mix of economic, financial, environmental, social, human rights and governance benefits.

2. Transparency: All parties should have access to the information that they need to make informed decisions.

3. Due diligence: The sovereign debtor and its creditors should each undertake appropriate due diligence before concluding a sovereign debt restructuring process.

4. Optimal outcome assessment: The parties should publicly disclose why they expect their restructuring agreement to result in an optimal outcome.

5. Monitoring: There should be credible mechanisms for monitoring the implementation of the restructuring agreement.

6. Inter-creditor comparability: All creditors should make a comparable contribution to the restructuring of debt.

7. Fair burden sharing: The burden of the restructuring should be fairly allocated between the negotiating parties.

8. Maintaining market access: The process should be designed to facilitate future market access for the borrower at affordable rates.

The G20’s current efforts to address the silent debt crisis are failing. They are contributing to the likely failure of low-income countries in Africa and the rest of the global south to offer all their residents the possibility of leading lives of dignity and opportunity.

Danny Bradlow is Professor/Senior Research Fellow, Centre for Advancement of Scholarship, University of Pretoria; Kevin P. Gallagher is Professor of Global Development Policy and Director, Global Development Policy Center, Boston University; Marina Zucker-Marques is Senior Academic Researcher, Boston University Global Development Policy Center, Boston University.

Boston University provides funding as a founding partner of The Conversation US; University of Pretoria provides funding as a partner of The Conversation AFRICA.

Source: The Conversation, based in Johannesburg South Africa, is a nonprofit, independent news organization dedicated to unlocking the knowledge of experts for the public good.

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By Naureen Hossain
UNITED NATIONS, Sep 27 2024 – In his first major address at the United Nations, the Chief Advisor of Bangladesh’s interim government, Dr. Muhammad Yunus, appealed to the international community to engage with a ‘new Bangladesh’ in the shared efforts to cooperate on global issues.

Yunus arrived earlier in the week to attend the 79th United Nations General Assembly (UNGA) in New York. In the four days he was here, Yunus held meetings with a range of world leaders, notably UN Secretary-General António Guterres and US President Joe Biden. This would indicate there is good support for him and what he represents. On Friday, Yunus addressed the General Assembly, speaking in his native language, Bangla.

“I stand in this parliament of nations thanks to an epochal transformation that Bangladesh witnessed this July and August,” said Yunus. “The ‘power of the ordinary people’, in particular our youth, presented to our nation an opportunity to overhaul many of our systems and institutions.”

Bangladesh is currently in a period of significant transition since the anti-government protests broke out in July earlier this year, which led to the ousting of former prime minister Sheikh Hasina. The protest movement began with calls for government reform before it transformed into a wider movement that spoke out against the government’s retaliatory tactics and deeper corruption within the administration and law enforcement.

Dr. Muhammad Yunus, Chief Advisor of Bangladesh’s interim government, arrived earlier in the week to attend the 79th United Nations General Assembly. Credit: Naureen Hossain/IPS

Shortly after Hasina’s departure on August 5, it was announced that an interim government would be instated with an agenda to implement sweeping reforms on law enforcement and government administration, among other matters. Yunus received an invitation from the protest movement to head the interim government thanks to his decades-long career in economics and civil society, his distinction as a Nobel laureate, and his recognition by the international community. He took office in Dhaka on August 12, 2024.

Yunus remarked that the new government would be committed to promoting and protecting fundamental rights and ensuring good governance across all sectors. Since its formation, this new government, Yunus said, has already launched independent commissions into the electoral process, the judicial system and the legal sectors.

“I wish to assure that our government shall adhere to all international, regional and bilateral instruments that Bangladesh is party to. Bangladesh will continue to remain an active proponent of multilateralism, with the UN at the core,” he said.

As the unrest in Bangladesh unfolded over several weeks, the United Nations offered to support Bangladesh in its efforts towards reform and to seek accountability and justice for the lives impacted during the protests.

Notably, UN Human Rights Commissioner Volker Türk deployed a team on a fact-finding mission to Bangladesh to investigate human rights violations that occurred over the protest movement in July, for which Yunus offered his gratitude.

This year marks 50 years of Bangladesh as a member of the United Nations. Yunus remarked on Bangladesh’s involvement with the UN through its work with the peacekeeping forces. Bangladesh is the third-largest contributor of peacekeepers among the member states. Yunus also noted the Culture of Peace resolution passed by the General Assembly in 20021 and the Microcredit Resolution in 1999.

In his address, Yunus also referred to the ongoing Rohingya refugee crisis, where Bangladesh has hosted over 1.2 million refugees over seven years. He called for the continued support from the international community on humanitarian operations for the refugee community, adding that the community and Bangladesh would need to work together to ensure the “dignified and sustainable return” to the Rakhine State in Myanmar.

Yunus called for new forms of collaboration between all stakeholders. He noted that this could be achieved through countries uniting and sharing resources and capacity to “leverage collective strength.”

“Time demands new attitudes, new values, new compact(s), across communities and countries, across developed and developing countries alike, across all actors and stakeholders,” he said.

Yunus also noted that through cooperation, developing countries such as those in the Global South were empowered to work towards innovative solutions. “It is also a growing necessity for the global South to make our voices heard. In shaping and steering the global agenda, the global South merits equal space and focus,” he noted.

Yunus concluded his address, reiterating his call for the world to pool its resources and solutions in working together to address the complex and interconnected issues the world must address, and in doing so, to uphold the rights and dignities of all people.

“Let us work together to end all forms of inequality and discrimination, within and among nations, especially in advancing the proposition of social business in our economic interactions.”
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By Mariela Jara
LIMA, Sep 27 2024 – The struggle for women’s right to decide in Latin America and the Caribbean, for their access to legal, safe and free abortion continues in the region, with some countries fully criminalising it, others with severe regulations, and a few guaranteeing better conditions, while threats of regression persist.

This Saturday 28 September marks, as every year, the Global Day of Action for Access to Safe and Legal Abortion, launched in 1990, at the 5th Latin American and Caribbean Feminist Meeting, held in Argentina.

Since then, the international day of action for safe abortion has been nurtured by the agreements reached at the Cairo Conference on Population and Development in 1994, which recognised sexual and reproductive rights as part of human rights, and by the mandates of Human Rights Committees demanding that countries decriminalise abortion and protect the rights of girls, adolescents and women.

“This is a historic struggle of the feminist movement. We have made progress in the recognition of women’s human rights in the region, but those related to sexual and reproductive rights and abortion continue to be polarising; however, we have no doubt that they must be integrated into our rights as a whole”.“We have seen the great influence of right-wing fundamentalist religious groups in countries where abortion is criminalised and in others where it is barely advancing on the grounds of risk to the woman’s life, malformations and danger to health”: Aidé García.

So said Aidé García, director of the non-governmental organisation Catholic Women for the Right to Decide in Mexico and former director of the organisation’s Latin American network, present in 10 countries.

The activist spoke to IPS from New York, where this September she takes part in several meetings in the framework of the High-Level Segment of the 79th General Assembly of the United Nations and the Summit of the Future.

About 51% of the more than 660 million people in Latin America and the Caribbean are women. This population faces diverse gender inequalities, according to a joint report by the Economic Commission for Latin America and the Caribbean (ECLAC) and UN Women in 2023.

The report claims that three out of every 10 women in the region live in poverty; one out of every 10 has experienced violence and, in addition, the maternal mortality rate is 87.6 per 100,000 live births.

In this context, preventing women who freely decide from terminating a pregnancy or persecuting and criminalising them for doing so, aggravates the violation of their human rights, with the connivance between the prevailing patriarchy, the Catholic Church and now even more of evangelical denominations.

A study by the Guttmacher Institute revealed that in 2010-2014 there were 6.5 million induced abortions in the region. When these are performed in unsafe conditions due to legal barriers or lack of economic resources, they cause many deaths and harm women’s overall health.

The other side of the coin is forced maternity.

Aidé García, Mexican social worker and women’s and human rights activist, former coordinator of the Latin American and Caribbean network Catholics for the Right to Decide. Credit: Courtesy of Aidé García

A scenario with gaps

“There is great inequality in Latin America and the Caribbean on the issue of abortion,” said García, who is a social worker and feminist with vast experience in contributing to debates on this issue in Mexico and in international forums.

“We have seen the great influence of right-wing fundamentalist religious groups in countries where abortion is criminalised and in others where it is barely advancing on the grounds of risk to the woman’s life, malformations and danger to health,” she said.

Among the 10 countries or territories where abortion is fully criminalised are Belize, El Salvador, Haiti, Jamaica, Honduras, Nicaragua, Dominican Republic and Suriname.

Cuba was the first to fully decriminalise voluntary termination of pregnancy in the region, in 1965, followed by Guyana in 1995. Then, in this century, Uruguay, Argentina, Colombia and Mexico, first in 13 states and then at the federal level.

In most, legislation regulates it only under the restricted grounds – and in many cases full of obstacles to its implementation – of rape, health and risk to the pregnant woman’s life, non-consensual artificial insemination, and foetal malformations incompatible with life.

The most favourable frameworks are in Colombia, where abortion is legalised during the first 24 weeks of gestation, Argentina and Guyana, where it is legal up to 14 weeks, Uruguay and Mexico, with up to 12 weeks, and Cuba during the first quarter.

The color green has spread from Argentina to other Latin American countries, to demand the right of women and feminist movements to legal and safe abortion. Credit: Walter Hupiú / IPS

These legal loopholes for access to abortion also reflect the resistance to recognising women’s right to voluntarily terminate a pregnancy.

“We are fighting for respect for the autonomy and the possibility that women and people with gestational capacity have to decide about our reproduction. We demand the recognition of the moral authority that is ours, because from a Judeo-Christian culture where the religious sphere often intervenes, women who make decisions about sexuality are blamed”, said García.

She drew attention to political, religious and economic interest groups in the region that seek to preserve a fundamentalist tradition that denies women decision-making and public and political participation.

“It has to do with a patriarchal and misogynist sense of the role that we are assigned in society, and that is a great struggle that we have in feminism because at the end of the day, it is about the control of our bodies”, she stressed.

Women and feminist movements in Latin America are fighting to spread throughout the region the tide of green scarves, which emerged in Argentina, with which they fill the streets in several demonstrations a year and which symbolise the struggle for the right to legal and safe abortion.

Brenda Álvarez, a feminist lawyer from Peru, director of the organization Proyecta Igualdad, which follows cases of women criminalized for the crime of abortion. Image: Courtesy of Brenda Álvarez

Criminalised and persecuted

Brenda Álvarez is a lawyer and president of Proyecta Igualdad, a non-governmental organisation in Peru, which through its Green Justice line provides legal counsel to prevent criminalisation in the care of obstetric emergencies related to abortion, a dramatic and little known reality in the country.

With 33 million people, the South American country is one of the most restrictive in the recognition of women’s reproductive rights. Since 1924, abortion has been criminalised, except for therapeutic reasons, when the life of the pregnant woman is in danger or there is a risk of serious and permanent damage to her health.

The struggles of feminists and women’s movements in recent decades to decriminalise abortion have come up against the opposition of conservatives linked to Catholic and evangelical religious groups, to the point that, although therapeutic abortion celebrated its 100th anniversary in 2024, the protocol for its implementation is barely 10 years old, and with limitations.

“In the midst of the pandemic, we learned of the case of Diana Aleman, a Venezuelan irregular migrant who died in a public hospital due to the criminalisation of abortion and the harassment she experienced. As we followed the case, we realised it was not the only one, that more people were experiencing this situation and were being prosecuted,” Álvarez told IPS at her office in Lima.

She said that women who go to health facilities for an obstetric emergency related to abortion are poor and vulnerable, uninformed of their rights, and in these circumstances face state violence.

“It is not only poor medical care or harassment at the time of service, but also dealing in the emergency room with interrogations by the police, the prosecutor’s office, even with samples taken by representatives of the Institute of Forensic Medicine, as was the case of a teenager a few weeks ago who arrived unconscious with pneumonia and septic shock. That’s how they wanted to take her statement,” she revealed.

In 2020-2021 they carried out the Being Born with Uterus study, which states that each year more than 184 police reports for abortion and more than 633 of prosecutorial investigations are filed in Peru. “It was alarming, even cases of therapeutic abortion that are not punishable were prosecuted, we found 55; and we found sentences including adolescents,” she explained.

Health personnel report obstetric emergencies if they suspect abortions under the questionable article 30 of the General Health Law No. 26842, and “the authorities are ready to respond as if there were no serious crimes to prosecute in the country”. Álvarez explained that the guarantee of due process is not fulfilled and that these are illegal processes.

“This is problematic because often the only evidence that ends in a conviction for abortion is the statement taken from women, girls and adolescents in health services in a context of coercion and absolute lack of legal protection,” she denounced.

Among the impacts of the criminalisation of abortion on women’s lives, she mentioned the loss of employment and mental health opportunities, the uncertainty that having a criminal record entails for the possibility of finding a job, the cost of going to the justice system “even when the legal defence is ex officio, which, we have seen, is not effective and part of the conviction system”.

In addition to the urgency of decriminalising abortion, she said there is a need to promote citizen empowerment by creating tools so that women can know and exercise their rights when they go to a hospital with an obstetric emergency. In this regard, her organisation has developed outreach and awareness-raising materials.

A feminist activist with the sign “I want my uterus free” during the 13th Latin American and Caribbean Feminist Meeting held in Lima. Credit: Mariela Jara / IPS

Improving the law and risks in the region

Twelve years ago, Uruguay passed the law on the Voluntary Interruption of Pregnancy up to 12 weeks of gestation, an important step forward in the region and the result of a long struggle by women and feminists for the legalisation of abortion. The law also established grounds for abortion in cases of serious health risk to the woman, rape and malformations incompatible with life outside the womb.

Soledad Gonzales, a political scientist specialising in gender issues, told IPS from Montevideo that there is a need to work for a new law that would remove the persistent restrictions.

In practice, this means barriers to the exercise of the right, such as the interdisciplinary board that evaluates the woman’s request, the appointment she must undergo to inform her of alternatives, and the five-day waiting period after which she either ratifies her will to end the pregnancy or not, in order to proceed according to her decision.

“A new law is in order. For example, women do not always realise they are pregnant after three months. They end up having abortions clandestinely, having started the abortion legally,” she said.

Gonzales said that the chances for this proposal, on which women’s and feminist organisations agree, will depend on the results of the Uruguayan general elections on 30 October.

García, from Catholic Women for the Right to Decide, also said that the risks of setbacks in women’s reproductive rights, such as the freedom to decide about their bodies and access to abortion in safe and free conditions, depends on the positions of governments, whether they are conservative or progressive.

“This is part of the historical struggle that leads us to never lower our guard,” she said.