FACT SHEET: President Clinton, Religious Leaders, Members of Congress Urge Full Funding for International Debt Relief for Poor Countries
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|   President Clinton, Religious Leaders, Members of Congress Urge Full   |
|        Funding for International Debt Relief for Poor Countries         |
|                             October 2, 2000                             |
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Today, in a White House meeting with a diverse group of religious leaders
and Members of Congress, President Clinton will call on Congress to fully
fund and authorize his international debt relief budget request.  Citing
unsustainable debt as a factor that is helping to keep many countries -- in
poverty, the President will continue to urge accelerated efforts against
global poverty that leaves over a billion people to survive on less than $1
a day.  The President will emphasize that, under the Cologne Debt
Initiative, the G-7 / G-8 countries? savings from debt relief would be
directed to education, health care, AIDS prevention, and other critical
needs.  Because other creditors are waiting to see whether the U.S. funds
its contribution, he will warn that international implementation of the
crucial initiative is likely to stall early next year if Congress fails to
appropriate $435 million and fully authorize the use of income from IMF
gold sales for debt relief.

PRESIDENT CLINTON WILL BE JOINED IN TODAY?S WHITE HOUSE MEETING BY KEY
RELIGIOUS LEADERS, MEMBERS OF CONGRESS & OTHERS TO URGE DEBT RELIEF:
Joining the President in urging the passage of the full debt relief request
will be key Members of Congress: Rep. John Kasich (R-OH), Rep. Nancy Pelosi
(D-CA), Rep. Spencer Bachus (R-AL),  Rep. John LaFalce (D-NY),  Rep. Maxine
Waters (D-CA), Rep. Jim Leach (R-IA); Sen. Patrick Leahy (D-VT),  Sen. Mike
DeWine (R-OH), Sen. Joseph Biden (D-DE),  Sen. Richard Lugar (R-IN),  Sen.
Connie Mack (R-FL), and key religious leaders: Archbishop Theodore
McCarrick, U.S. Catholic Conference;  Dr. M. G. "Pat" Robertson; Rev. David
Beckmann, Bread for the World; Rabbi David Saperstein, Religious Action
Center;  Bruce Wilkinson, Senior Vice President, World Vision;  Rev. Dr.
Andy Young, President, National Council of Churches;  Right Rev. Arthur
Williams, Jr., Vice President of House of Bishops ? Episcopal Church
(Diocese of Ohio in Cleveland); and the musician Bono.

THE PRESIDENT?S BUDGET REQUESTS $435 MILLION TO FUND AMERICA?S
INTERNATIONAL OBLIGATION AS PART OF THE COLOGNE DEBT RELIEF INITIATIVE:
Last fall, Congress approved only $110 million of the $920 million the
President requested over four years to cover the cost of U.S. participation
in the expanded international debt relief efforts launched at the Cologne
G-7/G-8 Summit.  As a result, this year he has requested $435 million and
additional authorization for the use of IMF gold sale investment proceeds
to finance debt relief.  Already, Bolivia and Honduras are seeing their
debt relief packages stalled because of inaction by the U.S. Congress on
the President?s request.  The House this summer took a step in the right
direction by approving an amendment offered by Rep. Waters to the Foreign
Operations Appropriations bill to provide $225 million; the Senate has
included only $75 million in its bill, however.   The President?s full
request ($435 million and gold authorization) is what is needed to keep
implementation of the program from stalling out next year.

THE U.S. HAS BEEN AN INTERNATIONAL LEADER ON DEBT RELIEF FOR DEVELOPING
NATIONS:  In March 1999, President Clinton presented a plan to a
U.S.-Africa Summit in Washington that became the basis for the G-7
agreement in Cologne, Germany (known as the Cologne Debt Initiative) to
triple the amount of debt relief available for poor countries, reducing
their debt by about 70% or $90 billion -- from an estimated $127 billion to
as low as $37 billion -- in return for firm commitments to channel the
benefits into improving the lives of all their people.  Building on that
agreement, last September, the President announced that the U.S. would
unilaterally exceed the terms of the G-7 initiative and entirely cancel the
$5.7 billion in U.S. government debt owed by qualifying countries.  The
Cologne Debt Initiative called for only 90% debt reduction for certain
types of bilateral debt. In addition, the U.S. has supported efforts to
expedite the process of qualifying countries for the expanded Heavily
Indebted Poor Country (HIPC) program.

INTERNATIONAL DEBT RELIEF WILL HELP FREE UP SCARCE RESOURCES FOR HEALTH AND
EDUCATION IN DEVELOPING NATIONS:  For the average HIPC country, the share
of scarce government revenue devoted to debt service (primarily interest
payments) could fall by 25% to 50% if countries comply with their
obligation to pursue economic reforms and promote poverty reduction.  For
example, Mozambique?s debt is expected to be reduced by over $4 billion,
which could cut in half the share of government revenues allocated to
external debt service, and free about $100 million in budgetary resources
each year.  These savings are equivalent to double the health budget in
1998 in a country where children are more than 3 times as likely to die
before the age of five as they are to go to secondary school.  In Uganda,
enhanced debt reduction could allow health and education spending to
increase by 50% from 1998 to 2001 and rural development expenditures to
more than double.

AS MANY AS 33 HEAVILY INDEBTED POOR COUNTRIES REPRESENTING 430 MILLION
PEOPLE COULD ULTIMATELY BE AFFECTED:   The 33 countries that could
potentially benefit from debt relief are Honduras, Mauritania, Nicaragua,
Tanzania, Benin, Bolivia, Burkina Faso, Cote d?Ivoire, Guyana, Mali,
Mozambique, Senegal, Uganda, Cameroon, Chad, Republic of Congo, Ethiopia,
Ghana, Guinea, Guinea-Bissau, Laos, Madagascar, Malawi, Niger, Rwanda,
Sierra Leone, Togo, Zambia, Central African Republic, Burundi, Congo DR,
Sao Tome, and The Gambia.

TEN COUNTRIES HAVE QUALIFIED FOR EXPANDED DEBT RELIEF SO FAR.  These are
Benin, Bolivia, Burkina Faso, Guyana, Honduras, Mali, Mauritania,
Mozambique, Senegal, Tanzania, and Uganda.  Another ten could qualify by
the end of 2000 (Cameroon, Chad, The Gambia, Guinea, Guyana, Guinea-Bissau,
Malawi, Nicaragua, Rwanda, and Zambia).  That is the expectation set by the
G-8 with U.S. support at the July Okinawa Summit.  The majority of the
remaining HIPCs have not made progress toward qualifying because of their
engagement in conflict.  Others have been slow to develop their poverty
reduction strategies, which are necessary to ensure that the savings from
debt relief go toward productive investments to reduce poverty, like basic
education and health care, rather than military spending.  Still others
have not requested the extra debt relief.

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