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ActionAid faults IMF, World Bank policies, calls for cancellation of debts owed by Zambia, others


ActionAid USA has called for the cancelation of Zambia and other African countries’ debt to help free up the finances needed to build resilience to climate impacts.

Niranjali Amerasinghe, Country Director of ActionAid USA, also noted the need to overhaul the international financial architecture with a proper debt workout mechanism.

In a statement issued in Lusaka on Monday after concluding their Spring meetings in Washington DC, Amerasinghe said this was to ensure global South governments had a say over policies impacting them disproportionately.

She noted that global South countries had been pushed further into debt and are reeling from the impacts of International Monetary Fund (IMF)-imposed austerity measures.

“Despite following the IMF’s advice for decades, many African countries are in debt distress or facing a high risk of debt distress,” Amerasinghe stated.

She said austerity measures had blocked the recruitment of teachers, doctors and nurses, even in countries with severe shortages and had squeezed public sector salaries at a time of a rising cost of living.

Amerasinghe added that Kristalina Georgieva’s appointment at the IMF as Managing Director was a continuation of the colonial era of ‘gentleman’s agreement’, where rich western powers had the most say.

“It is unacceptable that 80 years later we are still having to call this out. The IMF must change its leadership selection process, its decision-making model, and the harmful practices that keep developing countries in a cycle of crisis,” she stated.

Amerasinghe said as the climate crisis wreaks havoc, global South countries are so deep in debt that they cannot adapt to these impacts.

Read More: Forum says Zambia’s debt experiences send lessons to other African countries

Roos Saalbrink, Global Lead on Economic Justice and Public Services at ActionAid International, said countries in the global South had since the structural adjustment progammes been in perpetual austerity, eroding public health and education.

Saalbrink stated that at a time of unprecedented climate crisis and debt crisis in the global South, the Bretton Woods Institutions continue to oil the wheels of colonial exploitation and extraction.

“At the same time global South governments have very little to say in the policies coming from these institutions at the center of the international financial architecture. 80 years is enough,” he said

Saalbrink stated ActionAid was also concerned about a ‘gentleman’s agreement’ which had ensured that the IMF Managing Director had for 80 years been European and the World Bank president a US national.

He said the time was up for the IMF and the World Bank to continue with perpetuating a colonial rule.

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