Feminist Macro Economics Alliance-Malawi (FEAM) has asked rich governments and international lender institutions to unconditionally cancel Malawi’s external debt to enable the country channel its meagre resources towards helping its empoverished population and fighting the devastating effects of the Coronavirus disease (Covid-19) crisis.
Malawi’s foreign debt is 31 percent of the MK4.1 trillion public debt–which has become a concern among citizens considering the alarming rate at which the country continues to borrow.
Apparently, 17 percent of the country’s 2020/2021 national budget pegged at MK2.1 trillion, will be used to service those external and domestic debts, raising fears that government would end up not prioritizing the provision of some essential services to its citizens.
FEAM, comprising seven Civil Society Organizations (CSOs) and other partners that, among others, include ActionAid Malawi, NGO Gender Co-ordination Network, Malawi Human Rights Resource Centre and Open Society Initiative for Southern Africa–fights for the economic well-being of vulnerable groups of people especially women and girls.
The alliance’s call for the cancellation of Malawi’s external debt comes in the wake of the Global Week of Action (GWOA) for Debt Cancellation (October 10 to 17) for the Least Developed Countries (LDCs) to tackle the Coronavirus crisis.
FEAM partners held a news conference in the Capital, Lilongwe where they made their call–an activity they said seeks to contribute to raising more awareness about the debt issue and amplify CSOs and social movement voices on the issue of fiscal justice and public services.
Presenting their call through a joint statement titled “sounding the debt alarm” which was read out by the executive director for ActionAid Malawi Assan Golowa, the alliance partners emphasized that debt cancellation for Malawi should not be a question of mercy or forgiveness, but as a question of justice and survival.
“Many poor countries have been plunged into a new debt crisis as they attempt to respond to the threat of the virus whilst also managing debts that have catapulted.
“Even before the coronavirus crisis hit, Malawi is one of the least developed countries that faced debt crisis and the country was already spending more on debt payments to other wealthy governments or foreign lender institutions than it were on its health services, and in some cases, more than on health and another service combined,” the statement reads in part.
It adds: “This situation is pathetic especially considering the current public health crisis of coronavirus and there is no doubt that this will force government to take fresh loans to finance Covid-19 response and recovery, which will result in deeper debt problems soon.
“Without debt cancellation, many developing countries are likely to spend many years enduring reduced capital availability and severely restricted spending on public services and other necessities, creating yet another ‘lost decade’.
“Cancelling debt payment is the fastest way to keep money within Least Developed Countries like Malawi to enable them: Increase spending on healthcare, provide a safety net to the most vulnerable people and finance the rebuilding of their economies”.
According to FEAM, during the Global Week of Action for Debt Cancellation–movements, organizations and citizens groups around the world are coming together in the hope to generate greater impact to influence debt cancellation, including debt held by international institutions and private creditors.
Malawi had, at some point in the near past, its foreign debt cancelled–a process that began in the year 2000 and ended successfully in 2006 in what had been popularly known as Heavily Indebted Poor Countries (HIPC) Initiative.
That, however, was after Malawi met what FEAM partners describe as neoliberal conditions prescribed under the program by the International Monitory Fund and other bretton woods institutions–tough conditions that further plunged the country into more social and economic troubles.
This time around, the alliance partners say the debt cancellation should be unconditional as renowned activist and former legislator, Jessie Kabwira, emphasized in an interview after the press conference.
“These neoliberal policies really impact the poor very badly. So we are asking for unconditional cancellation. This is an issue of economic justice and of serving people’s lives. If we do not do the right thing, we are actually signing a death sentence for many of the poor people.
“Expect that schools will not operate as they are supposed to. We will not be able to provide menstrual hygiene. As a result, many of the girls will have to stay out of school. Women in business will suffer a lot. The health sector will be in serious trouble,” said Kabwira.
Speaking in an interview with Nyasa Times, Golowa said the FEAM members joint statement, whose contents reflect those of their global partners, will be made available to the G20 ministers who, he said, are meeting this week in the build up to the G20 summit itself.
“We believe this global voice is enough to move rich governments and international lenders to consider cancelling debt for poor countries like Malawi.
“President Lazarus Chakwera’s maiden speech at the United Nations General Assembly two weeks ago, gives credence to our call because he too highlighted the need for the debt cancellation. We are just reaffirming that statement from the government and the president that debt cancellation is very important for Malawi at this particular time,” he said.
The FEAM statement then winds up by calling upon government to commit to use resources freed from debt cancellation, if it really happens, to address immediate needs for vital and universal healthcare, social protection and other essential services and rights and secure the safety and well-being of people and communities.
It also says there must be national debt audits–both government audits and independent citizens’ audits–that will critically examine the nature, purpose, terms and conditions, actual use of loans, and the impacts of loan-supported policies and programs, and thorough-going review and changes in lending, borrowing and payment policies to prevent the re-accumulation of unsustainable and illegitimate debt.Follow and Subscribe Nyasa TV :