Congress Members Push for Debt Cancellation and Greater AIDS Assistance for Developing Nations

Members of the House Subcommittee on International Monetary Policy and Trade yesterday called for debt cancellation and increased funding to fight HIV/AIDS in Africa, Reuters reports. "We should call on the World Bank and the [International Monetary Fund] to cancel the debts they are owed by the impoverished countries of the world," Rep. Bernard Sanders (I-Vt.) said. He also urged the Bush administration to commit more than the $200 million pledged last week to the global AIDS trust fund, saying, "[W]e need to go a great deal farther." In addition, Rep. Sheila Jackson Lee (D-Texas) "reiterated her support" for the Debt Cancellation for HIV/AIDS Act of 2001 (HR 1567), which "would allow countries to invest money otherwise tied up in debt reimbursement to fight AIDS." However, Tony Gaeta, a spokesperson for the World Bank, told Reuters that debt cancellation "was impossible because of the revolving trust fund nature of the lending institutions," adding, "This is not World Bank money. Cancelling debt for 64 low-income countries -- [estimated at $175 billion] -- is a lot of money and it would wipe out the African and Asian development banks." Gaeta "defended" debt relief, or the reduction of loan repayment amounts, as a viable alternative to debt cancellation, stating that the Heavily Indebted Poor Countries initiative demonstrates that there is no "shortage of will" to help developing nations among the lending institutions, as Sanders had stated earlier in committee. Gaeta added that debt relief would allow the HIPC countries "to spend more on social services" to fight HIV/AIDS rather "than on servicing their debt" (Wilkinson, Reuters, 5/15).