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Ireland's Stance on Selling the Gold to Cancel the Debt
Many of you asked your TDs to put pressure on Minister Cowen during March and April to get Ireland to support IMF gold sales for debt cancellation. Your lobbying succeeded in getting a number of TDs to put questions to the Minister for Finance in the Dail to clarify Ireland's position on gold sales.

The Minister's reply suggested that Ireland is standing on the sidelines and not taking an active part in promoting debt cancellation or the sale of IMF gold.

The Relationship between the G7, IMF and World Bank
As the major decision makers at the IMF and World Bank, the G7 Finance Ministers meet together before hand. They are not an implementation body but they shape the outcome of the IMF and World Bank meetings. Below we give a summary of how little happened on debt at each of the three meetings which took place in Washington.

G7 Finance Ministers 15 April '05
The G7 merely reiterated their statement from their previous meeting in February'05 that they are willing to provide as much as 100% debt reduction to Heavily Indebted Poor Countries on a case by case basis. Particularly worrying is that the G7 statement only refers to debt owed to the World Bank and to the African Development Bank. Their previous statement referred to 'multilateral' debt which includes debt owed to the World Bank, the African Development AND the IMF.

On sale of IMF gold, it appears that the US is strongly opposed. While supporting 100% cancellation of HIPC debt to the World Bank and AFDB, the US is not in favour of cancellation of IMF debt . As far as we are aware, other G7 countries are not specifically opposed to IMF gold sales.

International Monetary Fund (IMF) Meeting 16 April
Given the weak position taken by the G7, it is not surprising that there was no concrete outcome from the IMF meeting. The IMF postponed discussion of cancellation of IMF debt to their September meeting. This meeting will also examine the use of IMF resources for debt cancellation. A paper prepared by IMF staff for the meeting showed that sale of IMF gold to finance debt cancellation was perfectly feasible. We had already demonstrated this in our paper 'The IMF, gold sales and multilateral debt cancellation' (see www.debtireland.org).
Sale of gold is not mentioned in the statement from the IMF meeting, presumably because of US opposition.

World Bank Meeting 17 April
The World Bank meeting recognised that further debt cancellation will be needed by some countries in order to achieve the Millennium Development Goals. But like the IMF, they postponed discussion on actual proposals for debt cancellation to the September meetings.

Going forward to the July G8 Summit in Scotland
Gordon Brown, UK Chancellor of the Exchequer chaired the IMF meeting. In a press conference, Mr. Brown claimed that the meeting had agreed on the importance of moving 'further and faster on debt relief' - a very unspecific statement. He was then pressed by a number of journalists who pointed out that IMF gold sales seemed to have disappeared from the agenda. Mr. Brown strongly denied that gold sales were no longer on the table. He was, however, not able to back this up with any evidence.

If the UK wants a positive result on debt from the July Summit, this puts them under pressure to convince the other G7 of the urgent need to resolve the debt crisis including debt owed to the IMF.

April 2005
Debt and Development Coalition Ireland

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