Debt and Human Rights
“To be honest, it is a scandal that we are forced to choose between basic health care and education for our people, to be able to repay old debt. Are we supposed to let our children die of diseases that can be prevented and cured, refuse them education, let the people drink dirty water, just to repay this debt?”
- Benjamin Mkapa, former president of Tanzania.
All people have a right to food, water, healthcare and basic education, but today several countries have to cut funding to schools, hospitals and water because they have to meet the requirements of their creditors. When debt burdens become so great that they are not possible to pay without inhibiting a country’s ability to provide basic human rights for its own inhabitants it is called unsustainable or unpayable debt. Debt Justice Norway and the international debt movement believes that this kind of debt should be cancelled. The International Monetary Fund (IMF) has on the other hand put forward such narrow standards for what qualifies as ‘unsustainable debt’, that several countries in need of debt cancellation are not getting the relief they need.
Even though the international financial institutions, The World Bank and IMF do not consider human rights standards when they calculate debt sustainability. Luckily, there are other actors that do important work on this issue. In 2012, the UN launched their guiding principles on debt and human rights which are supposed to guide lenders (those who are giving loans), and borrowers on how to meet the fulfill the international human rights.
The guiding principles state, among other things, that:
- All states have the obligation to respect, protect and fulfill human rights, and should ensure that activities concerning lending, borrowing, debt repayment or debt restructuring do not derogate from these obligations (principles 6 and 16)
- International financial organizations (such as the World Bank and the IMF) and private corporations have an obligation to respect international human rights, and to refrain from actions that can contravene the enjoyment of human rights (principle 9)
- Creditors and debtors share responsibility for preventing and resolving unsustainable debt situations, and the creditor have a duty to refrain from providing a loan in circumstances where the lender is aware that the funds will be used for non-public purposes or for non-viable projects (principle 23)