Creditor Goverment, Norway, to Audit Debts Owed to it
16 Aug 2012
Creditor Government, Norway, to Audit Debts Owed to It!
Irish debt justice campaigning group Debt and Development Coalition Ireland celebrated the decision today of the Norwegian Minister of Development Heikki Holmås that Norway will make an assessment of the legitimacy of impoverished countries' debts to Norway. This makes the Norwegian government the first government to ever carry out a creditor's debt audit.
Nessa Ní Chasaide, of Debt and Development Coalition Ireland said, "This is a fantastic step toward international debt justice. Developing countries have been paying unjust debts for generations. Finally, a lending government is questioning its right to collect those debts." She continued, "That is why are calling for independent debt audits and the cancellation of illegitimate debts in impoverished countries, such as in Zimbabwe, and for the cancellation of illegitimate debts in Ireland such as those of Anglo Irish Bank."
Gina Ekholt, Director of SLUG, the Norwegian Coalition for Debt Cancellation, said: "This is a historic day. Not only for debt campaigners who have been fighting for this for years, but also for the people across the world that are suffering from unpayable and illegitimate debt burdens. This is an important tool to promote responsible lending and to take responsibility for past loans. We hope that other creditors will be inspired by Norway's debt audit."
Since elected in 2009, the Norwegian government has promised to carry out a debt audit, as well as working to establish binding guidelines for responsible lending. Today, Holmås promised that the audit will be followed up with new and stronger guidelines for responsible lending.
Øygunn Sundsbø Brynildsen, at the European Network on Debt and Development said: "The ongoing global financial crisis is only one example of the devastating consequences of reckless lending. Today's initiative has the potential to be a game-changer in the move towards more responsible finance. We hope other countries will be bold enough to follow Norway's lead towards policies that can help avoid future unjust debt burdens."
The Norwegian government has previously admitted their responsibility as a creditor for dirty debts attached to a particular set of loans for developing countries to buy Norwegian ships. In 2006 the government announced that they would cancel debts for seven countries because the original loans had been a "development policy failure".
Development Minister Holmås announced that the plan is for the audit to be concluded within a year.
Notes to Editor:
The Norwegian Coalition for Debt Cancellation (SLUG) has done its own investigation of debts owed to Norway. The research reveals that a part of Indonesia's current debt to Norway is clearly illegitimate. SLUG shows that the people of Indonesia is still paying for a wave power plant that was never built, and failed technology for sea monitoring systems.
Norwegian initiatives have led to the establishment of international principles for responsible lending and borrowing in the UN Conference on Trade and Development (UNCTAD). The principles will be applied in the Norwegian debt audit. In April, the UK government unsuccessfully tried to stop UNCTAD working on responsible lending and borrowing principles.
The campaign for an independent debt audit for Zimbabwe can be found here